Merits-based appellate adjudication bars dismissal for non-prosecution where the statute requires decision on the appeal itself.

The statutory phrase requiring the Tribunal to pass orders "thereon" after hearing the parties confines it to deciding the appeal on facts and law, not dismissing it for non-appearance. The commentary treats the appellate scheme under the excise and customs provisions as requiring merits-based adjudication, with procedural rules unable to override that substantive mandate. On that approach, a dismissal for want of prosecution would bypass the Tribunal's duty to decide the subject matter of the appeal, and the refusal to restore such an appeal would also be unsustainable.

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Issues: Whether the Appellate Tribunal had power to dismiss an appeal for want of prosecution or was bound to decide the appeal on merits even in the absence of the appellant.

Analysis: The expressions used in Section 35C(1) of the Central Excises and Salt Act, 1944 and Section 129B(1) of the Customs Act, 1962 require the Tribunal to pass orders "thereon" after hearing the parties, which confines the Tribunal to adjudicating the subject matter of the appeal on facts and law. The Court treated the scheme of these provisions as analogous to the provision considered by the Supreme Court in the cited income-tax decision and held that dismissal for non-appearance would bypass the statutory duty to decide the appeal on the merits. Rule 20 of the CEGAT (Procedural) Rules, 1982 could not be used to defeat the substantive appellate mandate.

Conclusion: The Tribunal had no power to dismiss the appeal for default and was required to decide it on merits; the impugned dismissal and refusal to restore the appeal were liable to be set aside.

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