2024 (12) TMI 620 - HC - Customs

Petition dismissed-cannot admit appeals without mandatory statutory pre-deposit under Section 129E of Customs Act, per precedent

Lalit Kulthia & Anr Versus Commissioner of Customs (Appeals) Mumbai III & Ors.

Petition dismissed. HC held it could not direct the appellate authority to admit appeals without the statutory pre-deposit under Section 129E of the ... Seeking a direction on the 1st Respondent i.e., Commissioner of Customs (Appeals), to admit the Petitioners’ appeal without insisting on a pre-deposit as stipulated in Section 129E of the Customs Act, 1962 - direction to restore the appeal which is already dismissed for want of pre-deposit - HELD THAT:- In Kotak Mahindra Bank Pvt Ltd Vs. Ambuj A Kasliwal and Others [2021 (2) TMI 1251 - SUPREME COURT], the Hon’ble Supreme Court has held that even the High Court should not direct the appellate authorities to admit and hear appeals unaccompanied by the minimum pre-deposit requirement under the statute. The Hon’ble Supreme Court held that discretion under Article 226 of the Constitution of India cannot be exercised against the mandatory requirement of statutory provision. In MANJEET SINGH VERSUS THE UNION OF INDIA THROUGH THE SECRETARY MINISTRY OF FINANCE & ORS. [2022 (10) TMI 893 - BOMBAY HIGH COURT] decided by the Coordinate Bench of this Court on 18 October 2022, relief of waiver of the minimum pre-deposit of 7.5% of the penalty under Section 129E of the Customs Act was declined. This decision considers all the contentions raised in this Petition and discusses earlier precedents on the subject. Therefore, based on the decision of the Hon’ble Supreme Court and this Court, no case is made to grant any relief to the Petitioners. Incidentally, the Petitioners had instituted Writ Petition in this Court to challenge the Order-In-Original without resorting to the appellate remedy. The said Petition was disposed of. It was clarified that the Petitioners would have to satisfy other requirements for filing an appeal, including the statutory requirement of pre-deposit in terms of Section 129E of the Customs Act. The Petitioners never challenged the order but chose to institute an appeal without the pre-deposit. After such appeal was not entertained, this Petition was filed, and the relief contrary to the statutory provisions was sought from this Court. Such relief cannot be granted in exercising our discretionary jurisdiction under Article 226 of the Constitution of India. Petition dismissed without any orders of cost. Issues:Petition seeking direction to admit appeal without pre-deposit under Customs Act, 1962.Analysis:The petitioners sought a direction to the Commissioner of Customs (Appeals) to admit their appeal without requiring a pre-deposit as mandated by Section 129E of the Customs Act, 1962. The argument put forth was that penalties cannot be imposed on gold without foreign marking, citing specific instances where the gold did not meet the specified criteria. The petitioner relied on legal precedents to argue that in certain cases, courts can waive the pre-deposit requirement under Article 226 of the Constitution. However, the court found these contentions irrelevant and unconvincing, stating that the merits of the case were not necessary to discuss. The relief sought by the petitioners contradicted the statutory provision of pre-deposit under Section 129E of the Customs Act. The court referenced a Supreme Court decision to emphasize that even the High Court should not direct appellate authorities to hear appeals without the required pre-deposit. Additionally, a previous decision by the court's Coordinate Bench was cited, where a similar relief of waiving the pre-deposit was declined, considering all arguments raised in the current petition and past precedents on the matter.The court concluded that based on the decisions of the Supreme Court and their own court, there was no basis to grant relief to the petitioners. It was highlighted that the petitioners had previously challenged an order without resorting to the appellate remedy, and the court had clarified the statutory requirement of pre-deposit during that proceeding. Despite this, the petitioners chose to file an appeal without the pre-deposit, leading to the current petition seeking relief contrary to statutory provisions. The court reiterated that discretionary jurisdiction under Article 226 of the Constitution cannot be used against mandatory statutory requirements. The court also addressed the reliance on Delhi High Court decisions by the petitioners, pointing out that those judgments did not consider the Supreme Court's decision highlighted in this case. Furthermore, the nature of the petitioners' business dealing with gold and diamond jewelry was contrasted with the cases of poor daily wage earners considered in the Delhi High Court decisions.In light of the above reasons, the court dismissed the petition without imposing any costs. The court emphasized that the case did not present a rare or deserving situation where a waiver of the pre-deposit could be granted, even if such discretion were available under extraordinary jurisdiction. The judgment highlighted the importance of adhering to statutory provisions and established legal principles in matters concerning pre-deposit requirements under the Customs Act, 1962.