2015 (2) TMI 1280 - HC - Central Excise

High Court Upholds Tribunal Decision on Pre-Deposit Orders

M/s. Swathy Industry Versus Customs, Excise & Service Tax Appellate Tribunal And The Commissioner of Central Excise

The High Court upheld the Tribunal's decision, emphasizing compliance with pre-deposit orders and considering the appellant's financial hardship plea. The ... Pre-deposit - Whether the first respondent Tribunal is right in rejecting the appellant's application for waiver of pre-deposit without considering “undue hardship”, which is a relevant factor while exercising powers under Section 35-F of the Central Excise Act? - Held that:- In view of the well considered order of the Tribunal, wherein the prima facie case and financial hardship of the appellant were taken into consideration while ordering pre-deposit, which order has not been complied with, the bona fide of the appellant in filing the appeal now itself is in question - This Court finds no reason to interfere with the order of the Tribunal at this point of time, more so when the issue has become stale by efflux of time. The appellant is unable to point out any question of law that warrants consideration by this Court to justify this appeal. Appeal dismissed - decided against appellant. Issues:1) Tribunal's directive for pre-deposit without considering the case on merits.2) Rejection of appellant's application for waiver of pre-deposit without considering 'undue hardship' under Section 35-F of the Central Excise Act.Analysis:Issue 1:The appellant, engaged in manufacturing detergent cakes and washing powder, received a show cause notice for alleged clandestine removal of goods. The Tribunal directed a pre-deposit of Rs. 1 Crore, citing lack of prima facie merit in the appellant's submissions regarding assessment and denial of cross-examination requests. The Tribunal considered the financial hardship plea but still ordered the pre-deposit. Non-compliance led to dismissal of the appeal. The appellant's subsequent application for modification was rejected by the Tribunal, leading to the current appeal.Issue 2:The High Court reviewed the Tribunal's decision and found that the Tribunal had considered the prima facie case and financial hardship of the appellant before ordering the pre-deposit. Despite the appellant's inability to comply with the order, the Tribunal dismissed the appeal. The Court noted the delay in filing the appeal and lack of substantial legal questions raised by the appellant. Consequently, the Court upheld the Tribunal's decision and dismissed the appeal and connected miscellaneous petition.In conclusion, the High Court upheld the Tribunal's decision, emphasizing the importance of compliance with pre-deposit orders and considering the appellant's financial hardship plea. The Court found no substantial legal questions to warrant interference with the Tribunal's decision, leading to the dismissal of the appeal and related petition.