2015 (4) TMI 952 - HC - Customs

Court waives pre-deposit for appeal, petitioner exempt from 7.5% duty, ensuring appeal rights

The court allowed the review petition, disposing of the writ petition with directions that the petitioner could proceed with the appeal before the ... Right of appeal governed by law prevailing at the date of institution of the lis - pre-deposit requirement as condition for maintaining appeal - waiver of pre-deposit and stay of recovery - effect of amendment of 2014 on pending lisRight of appeal governed by law prevailing at the date of institution of the lis - effect of amendment of 2014 on pending lis - Whether the 2014 amendment imposing a 7.5% pre-deposit applies to the petitioner whose lis commenced prior to the amendment - HELD THAT: - The Court applied the settled principle that institution of proceedings preserves the rights of appeal as they stood at the date the lis commenced, so that subsequent legislative amendment does not operate to modify the appellate rights vested at institution. Having found that the lis in the present case commenced prior to the 2014 amendment, the Court held that the petitioner is not obliged to comply with the 7.5% pre-deposit condition introduced by the 2014 amendment. The Court therefore treated the appeal as governed by the statutory regime prevailing before the amendment and recalled its earlier order which had required the pre-deposit. The determinative reasoning rests on the preservation of appellate rights at the date of institution and the non-retrospective operation of the amendment insofar as pending lis are concerned. [Paras 5]The 2014 amendment requiring a 7.5% pre-deposit does not apply to the petitioner because the lis commenced prior to the amendment; the petitioner is governed by the pre-amendment law.Pre-deposit requirement as condition for maintaining appeal - waiver of pre-deposit and stay of recovery - Whether the petitioner must deposit 7.5% as a pre-condition to maintain the appeal and whether the Tribunal should consider the waiver application - HELD THAT: - The Court directed that the petitioner shall not be required to make the 7.5% payment as a pre-condition for maintaining the appeal or the waiver application before the Appellate Tribunal, since the appeal is to be governed by the pre-amendment provisions. The Tribunal was instructed to consider the petitioner's application for waiver of pre-deposit on merits and thereafter proceed to hear the appeal in due course. This amounts to remitting the matter to the Tribunal for adjudication of the waiver application and the appeal under the law as it stood prior to the 2014 amendment. [Paras 5, 6]The petitioner need not pre-deposit 7.5% to maintain the appeal; the Tribunal must consider the waiver application on merits and thereafter hear the appeal under the pre-amendment statutory regime.Final Conclusion: Review petition allowed; previous order recalled. The writ petition is disposed by holding that the 2014 amendment's pre-deposit requirement does not apply to lis commenced before that amendment and directing the Appellate Tribunal to consider the petitioner's waiver application on merits and to hear the appeal under the pre-amendment law. Issues:Challenge of an order under the Customs Act,1962; Legality of pre-deposit condition for appeal before Appellate Tribunal; Right to appeal under the Statute; Review of judgment not specifically addressing contentions against the impugned order.Analysis:The petitioner filed a petition challenging an order passed by the respondent under the Customs Act,1962. The petitioner was directed to pay 7.5% of the duty confirmed against him by the order as a condition for maintaining an appeal before the Customs, Excise and Service Tax Appellate Tribunal. The petitioner contended that this condition deprived him of the right to appeal. The court extended the time for compliance with the deposit condition till a specified date, emphasizing the necessity of the pre-deposit before the Appellate Tribunal.In the review petition, the petitioner argued that the previous judgment did not specifically address the challenge against the impugned order. The court noted that the challenge was not elaborated upon in the previous judgment due to the petitioner already filing an appeal before the Appellate Tribunal. The court referenced a similar case where it was held that the right of appeal under the old provisions of the law would not be affected by new amendments if the case commenced before the amendment. Applying this principle, the court recalled the previous judgment and disposed of the writ petition with specific directions.The court reiterated the legal principle that the right of appeal is governed by the law prevailing at the time of the institution of the suit or proceedings. In this case, since the dispute began before the 2014 amendment, the petitioner was not required to make the 7.5% pre-deposit. The petitioner was allowed to proceed with the appeal and waiver application before the Appellate Tribunal without the pre-deposit condition. The Tribunal was instructed to consider the waiver application on its merits and proceed with the appeal accordingly.Therefore, the review petition was allowed, and the writ petition was disposed of with the above directions, ensuring the petitioner's right to appeal without the burden of the pre-deposit condition under the amended law.