Supreme Court directs parties to Tribunal without pre-deposit, daily hearings ordered. Appeal disposed without costs.

The Supreme Court set aside the High Court's order that delved into the merits of adjudication proceedings instead of focusing on the pre-deposit issue. The Court directed the parties to appear before the Tribunal without requiring pre-deposit, with appeals to be heard daily. The appeal was disposed of without costs, with respondents instructed to file an undertaking to settle any demands sustained by the Tribunal within eight weeks, subject to interim protection.

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Issues:
Challenge to order setting aside Tribunal's decision on pre-deposit.

Analysis:
The appeal before the Supreme Court challenged the Gujarat High Court's order that set aside the decision of the Appellate Tribunal for Foreign Exchange (Tribunal) rejecting the application for dispensation of pre-deposit. The case involved alleged violations of the Customs Act 1962, leading to penalties imposed on the noticees. The respondents challenged the penalties before the CESTAT, along with an application for dispensation of the penalty deposit, which was rejected. The High Court not only addressed the pre-deposit issue but also delved into the merits of the adjudication proceedings, setting aside the adjudication order and remitting the matter back to the adjudicating authority.

The appellant argued that the High Court's approach was unsustainable as the primary challenge was to the Tribunal's order on pre-deposit. The High Court, instead of focusing on pre-deposit, delved into the merits of the adjudication, which should have been left for the Tribunal to decide. The Tribunal's rejection of the pre-deposit application was based on the factors of prima facie case, balance of convenience, and irreparable loss. The Supreme Court found that the High Court's interference in the merits and remitting the matter to the Tribunal was not justified. The Court set aside the High Court's order and directed the parties to appear before the Tribunal without insistence on pre-deposit, with the appeals to be heard on a day-to-day basis.

In conclusion, the Supreme Court disposed of the appeal without costs, setting aside the High Court's order and directing the Tribunal to hear the appeals without requiring pre-deposit. The respondents were directed to file an undertaking to liquidate any demands sustained by the Tribunal within eight weeks from the date of receipt of the Tribunal's order, subject to any interim protection granted in the appeal.

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