2019 (6) TMI 29 - HC - Customs

High Court waives pre-deposit requirement, directs CESTAT to consider appeal promptly

M/s. Shubh Impex Versus Customs Excise & Service Tax Appellate Tribunal & Ors.

The High Court ruled in favor of the Petitioner, waiving the requirement for an additional pre-deposit under Section 129-E of the Customs Act, 1962 for ... Requirement of making a pre-deposit - Section 129-E of the Customs Act, 1962 - HELD THAT:- Since the financial condition of the Petitioner has not undergone any significant change, and the above deposit of ₹ 5 lakhs has already been made, it is directed that without requiring the Petitioner to make any further deposit, its appeal be considered by the CESTAT on merits in accordance with law as expeditiously as possible. The Defect Matter Hearing Notice dated 29th April 2019 issued by the Registry of the CESTAT is hereby quashed - application disposed off. Issues:1. Requirement of pre-deposit under Section 129-E of the Customs Act, 1962 for appeal consideration by CESTAT.2. Applicability of pre-deposit amount for appeal before CESTAT.3. Classification issue of imported goods under CTH 83081010 or CTH 6212.4. Merits of the case based on past judgments by CESTAT.5. Financial condition of the Petitioner affecting pre-deposit requirements.Analysis:1. The Petitioner approached the High Court on the limited issue of the necessity of making a pre-deposit under Section 129-E of the Customs Act, 1962 for the appeal to be considered by CESTAT.2. Previously, the Petitioner had filed a writ petition regarding the pre-deposit requirement. A Division Bench of the High Court had allowed the Petitioner to make a further pre-deposit of Rs. 5 lakhs, in addition to the amount already deposited, to entertain its appeal by the first Appellate Authority.3. The current issue before CESTAT involved the classification of imported goods as 'Hooks & Eyes Fastening Strips Polyester' under CTH 83081010 (Petitioner's contention) or CTH 6212 (Department's contention), with past judgments indicating conflicting views by CESTAT.4. The Respondent argued that based on a similar case, the Petitioner lacked a prima facie case on merits. However, the Petitioner's counsel highlighted a subsequent order by CESTAT questioning the correctness of its decision in a similar case, favoring the Petitioner's classification argument.5. Considering the financial stability of the Petitioner and the previous pre-deposit made, the High Court directed CESTAT to proceed with the appeal without requiring any additional deposit, emphasizing a prompt consideration of the appeal on its merits.6. Consequently, the Defect Matter Hearing Notice issued by the CESTAT Registry was quashed by the High Court, and the writ petition along with the application was disposed of accordingly, ensuring the parties received a copy of the order promptly.