High Court allows appeal under Customs Act, Rs.12 crore deposit partially waived, further adjudication required.

The High Court partially allowed the appeal challenging the order under Section 129-A (4) of the Customs Act, which directed a deposit of Rs.12 crore. The Court stayed the recovery, permitting a cash deposit of Rs.3 crore and security for the remaining Rs.9 crore. The appellant's request for waiver of the balance amount due to financial hardship was not fully granted. The Court found the matter required further adjudication to assess the correctness of the Department's allegations, allowing the appeal to proceed on merit. The appellant was directed to file an affidavit for the deposit and security within a week for the Tribunal to promptly address the appeal's merit.

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Issues:
Challenge to order under Section 129-A (4) of the Customs Act regarding penalty deposit waiver and direction to deposit a sum of Rs.12 crore. Consideration of financial hardship, justification of Tribunal's order, and merit of the appeal.

Analysis:
The appellant challenged an order under Section 129-A (4) of the Customs Act, where the Tribunal waived the penalty deposit and directed a deposit of Rs.12 crore within 8 weeks. The High Court stayed the recovery, allowing a deposit of Rs.3 crore in cash and furnishing security for the remaining Rs.9 crore. A supplementary affidavit was filed, stating compliance with the deposit and security requirements. The appellant argued that the demand for the period of 2004-05 to 2008-09 was unjustified, specifically objecting to allegations regarding three consignments in 2008. The appellant requested the waiver of the balance amount due to financial hardship and urged the Tribunal to decide the appeal on merit. The respondent's counsel contended that the Tribunal's order was justified based on the facts and circumstances.

Upon reviewing the submissions and the record, the Court found the matter required adjudication to determine the correctness of the Department's allegations regarding the three consignments and the duty demand for past periods based on those transactions. Considering the circumstances, the Court deemed the deposit of Rs.3 crore and security of Rs.9 crore sufficient under the interim order, allowing the appeal to be heard on merit. Consequently, the appeal was partially allowed, directing the appellant to file an affidavit for the deposit and security within a week for the Tribunal to proceed with the appeal's merit promptly.

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