Court upholds Tribunal's duty deposit order in face of challenge under Article 226, Central Excise Act appeal available.

The court dismissed the petition challenging the Customs, Excise, and Service Tax Appellate Tribunal's order directing duty deposit while waiving penalty. The court held that the petition under Article 226 was maintainable despite the availability of an appeal under Section 35G of the Central Excise Act. It clarified that the Tribunal's order was not perverse, and the Tribunal had not exceeded its jurisdiction. The court emphasized refraining from preempting the Tribunal's decision by making observations on the issues raised in the writ petition.

---

---

Issues Involved:
1. Maintainability of the petition under Article 226 of the Constitution.
2. Availability of an alternate remedy under Section 35G of the Central Excise Act.
3. Jurisdiction of a Single Judge to entertain the petition.
4. Prima facie case and undue hardship for waiver of pre-deposit under Section 35F of the Central Excise Act.
5. Applicability of exemption notifications dated 8th January 2004 and 1st March 2006.

Detailed Analysis:

1. Maintainability of the Petition under Article 226 of the Constitution:

The petitioner challenged the order passed by the Customs, Excise, and Service Tax Appellate Tribunal, which directed the petitioner to deposit the duty amount while waiving the penalty. The learned Assistant Solicitor General argued that the petition was not tenable since an appeal under Section 35G of the Central Excise Act was available. The court noted that while an alternate remedy discourages the court from entertaining a writ petition, it is a self-imposed restriction and does not bar the petition as a rule.

2. Availability of an Alternate Remedy under Section 35G of the Central Excise Act:

The court considered judgments from the High Courts of Allahabad and Delhi, which had differing views on whether an appeal against an order dealing with the waiver of pre-deposit could be filed under Section 35G. The court concluded that the expression in Section 35G is wide enough to include orders of waiver of pre-deposit under Section 35F. However, the difficulty in making out a case for entertaining an appeal cannot be equated to non-availability of the remedy of appeal.

3. Jurisdiction of a Single Judge to Entertain the Petition:

The learned Assistant Solicitor General argued that the Tribunal was constituted under Article 323B of the Constitution, and therefore, a petition against its orders should be entertained only by a Division Bench. The court found that the Tribunal was constituted under Section 129 of the Customs Act, not under Article 323B, and hence, a Single Judge could entertain the petition.

4. Prima Facie Case and Undue Hardship for Waiver of Pre-Deposit under Section 35F of the Central Excise Act:

The petitioner argued that undue hardship includes a prima facie absence of liability to pay or a strong prima facie case. The court referred to various judgments which held that if an appellant has a strong prima facie case, it would cause undue hardship to deposit the amount. The court noted that the petitioner had obtained an exemption certificate under Notification No. 6/2006 but not under Notification No. 3/2004, which included industrial use. The court found that the petitioner had an arguable case but not a strong prima facie case, and the partial waiver granted by the Tribunal safeguarded the interests of revenue.

5. Applicability of Exemption Notifications Dated 8th January 2004 and 1st March 2006:

The petitioner contended that the goods were exempt under both notifications. The court noted that the notification dated 1st March 2006 excluded equipment for supplying water for industrial purposes, while the notification dated 8th January 2004 included agricultural or industrial use. The court found that the petitioner could not infer that the entire pipeline was certified for domestic water supply. The court concluded that the petitioner made out an arguable case but not a strong prima facie case, and the Tribunal's order of partial waiver was appropriate.

Conclusion:

The court dismissed the petition, holding that the Tribunal's order was neither perverse nor untenable, and the Tribunal did not exceed its jurisdiction. The court also emphasized that making any observation on the issues in the present writ petition would preempt the Tribunal's decision, which could be inappropriate.

---