Pre-deposit compliance fails where binding precedent says wire drawing is not manufacture, requiring merits-based reconsideration.

Drawing wires from wire rods was treated as a process already covered by binding Supreme Court precedent holding that it does not amount to manufacture. In that setting, the appellate authority was required to consider the effect of that precedent before rejecting the appeal for non-compliance with the pre-deposit condition. Because the impugned order did not address the binding legal position and the amount already deposited was relevant to compliance, the dismissal for non-compliance was held unsustainable. The matter was remanded for fresh decision on merits, with the deposit already made treated as sufficient compliance.

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Issues: Whether the dismissal of the appeal for non-compliance with the pre-deposit requirement was sustainable when the assessee's activity consisted of drawing wires from wire rods and a binding precedent held such process not to amount to manufacture.

Analysis: The appeal had been rejected at the threshold for non-deposit under the pre-deposit provision. The record showed that the dispute arose from the assessee's process of drawing wires from wire rods of higher gauge. The governing legal position, as settled by the Supreme Court, was that such a process does not amount to manufacture. While deciding the issue of duty liability and compliance with the pre-deposit requirement, the appellate authority was required to consider the effect of that binding ruling on the facts before it. The impugned order was passed without dealing with that legal position, and the amount already deposited was also relevant for compliance.

Conclusion: The dismissal for non-compliance was unsustainable. The order was set aside and the matter was remanded to the appellate authority to decide the appeal afresh on merits, treating the amount already deposited as sufficient compliance.

Ratio Decidendi: Where the assessee's activity is prima facie covered by a binding ruling that it does not amount to manufacture, the appellate authority cannot insist on pre-deposit or dismiss the appeal for non-compliance without first considering that ruling and its effect on the duty dispute.

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