Tribunal must hear appeal as per Supreme Court ruling; appellant to comply with stay conditions.

The High Court held that the Tribunal must hear the appeal on merits per the Supreme Court's ruling, but the appellant must adhere to the conditions set during the grant of stay. The appeal was reinstated with the requirement to deposit Rs. 7,00,000 within two months; failure to comply would lead to dismissal. The High Court did not address the appeal's merits or award costs.

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Issues Involved:
1. Whether the Tribunal was justified in dismissing the appeal for want of prosecution.
2. Whether the Tribunal should have heard the appeal on merits despite non-compliance with the conditions imposed during the grant of stay.
3. Application of the Supreme Court's judgment in BALAJI STEEL REROLLING MILLS VS. COMMISSIONER OF C.EXCISE AND CUSTOMS.
4. Restoration of appeal and compliance with conditions imposed by the Tribunal.

Detailed Analysis:

Issue 1: Dismissal for Want of Prosecution
The primary issue was whether the Tribunal was justified in dismissing the appeal for want of prosecution. The appellant argued that the Tribunal had no power to dismiss a statutory appeal for want of prosecution, emphasizing that the Tribunal was obliged to hear the appeal on merits regardless of the appellant's failure to comply with the conditions imposed during the grant of stay. The appellant relied on the Supreme Court's judgment in BALAJI STEEL REROLLING MILLS, which held that the Tribunal does not have the power to dismiss an appeal for default or want of prosecution if the appellant is not present when the appeal is taken up for hearing.

Issue 2: Hearing on Merits Despite Non-compliance
The appellant contended that even though the appellant did not comply with the conditions imposed by the Tribunal while granting stay, the Tribunal should have heard the appeal on merits. The appellant's counsel argued that the right to have the appeal heard on merits is vested in the assessee. The Tribunal had dismissed the appeal for non-compliance with the conditions imposed during the grant of stay and for non-prosecution.

Issue 3: Application of Supreme Court Judgment
The Supreme Court's judgment in BALAJI STEEL REROLLING MILLS was pivotal. The Supreme Court had analyzed Section 35C of the Central Excise Act, 1944, which mandates that the Tribunal must pass orders on the appeal confirming, modifying, or annulling the decision or order appealed against and does not grant the Tribunal the power to dismiss the appeal for want of prosecution. The Supreme Court held that the Tribunal must decide the appeal on merits even if the appellant or its counsel is not present when the appeal is taken up for hearing.

Issue 4: Restoration of Appeal and Compliance with Conditions
The appellant had applied for the restoration of the appeal, invoking the inherent powers of the Tribunal. The Tribunal, however, observed that the appellant had neither complied with the conditions imposed while granting stay nor appeared and argued the appeal on earlier occasions. The Tribunal dismissed the restoration application, stating it was not a fit case for exercising discretionary powers. The High Court, while agreeing with the Supreme Court's judgment, emphasized that the appellant must comply with the conditions imposed by the Tribunal while granting interim relief. The High Court ordered the restoration of the appeal on the condition that the appellant deposits Rs. 7,00,000 within two months and produces proof thereof. Failure to comply would result in the dismissal of the appeal standing.

Conclusion:
The High Court concluded that while the Tribunal must hear the appeal on merits as per the Supreme Court's judgment, the appellant must comply with the conditions imposed during the grant of stay. The appeal was restored on the condition of depositing Rs. 7,00,000 within two months, failing which the dismissal of the appeal would stand. The High Court did not express any opinion on the merits of the appeals and made no order as to costs.

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