Pre-deposit compliance and merits review required; dismissal without deciding the dispute was set aside and remanded.

Where the assessee complied with the pre-deposit requirement under Section 35F of the Central Excise Act, an appellate dismissal based only on alleged non-compliance could not stand if no finding on merits had been recorded. The first appellate authority was required to decide the dispute on merits after granting a reasonable opportunity of hearing. The impugned order was accordingly set aside and the matter remitted to the Commissioner (Appeals) for fresh consideration.

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Issues: Whether the appeal deserved remand after the assessee complied with the pre-deposit direction and the Commissioner (Appeals) had dismissed the matter without recording any finding on merits.

Analysis: The appeal had been dismissed for non-compliance with the pre-deposit requirement. The record showed that the appellants had complied with the pre-deposit direction under Section 35F of the Central Excise Act, and the appellate authority had not decided the controversy on merits. In such circumstances, the impugned order could not be sustained, and the matter required reconsideration by the first appellate authority after giving the assessee a reasonable opportunity of hearing.

Conclusion: The impugned order was set aside and the matter was remitted to the Commissioner (Appeals) for fresh decision after affording a reasonable opportunity of hearing to the assessee.

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