2003 (8) TMI 211 - HC - Customs

Court Upholds Dismissal of Appeals for Non-Compliance with Deposit Order

The Court upheld the dismissal of appeals by the Customs, Excise and Gold (Control) Appellate Tribunal due to the petitioners' failure to comply with the ... Right to appeal – conditional or unconditional – powers of the legislature to impose conditions Held that: - It is true that right to appeal is a substantive right granted by the Legislature but the right is not absolute. While granting such a right, the Legislature is competent to subject the right to certain pre-conditions. Section 129-E of the Act stipulates that no appeal under Chapter XV is competent unless the duty or penalty and interest in dispute is deposited. The condition is mandatory. - , in the instant case, except for financial difficulty, no other point is urged - the plea that an unconditional stay should be granted to them cannot be accepted Issues:1. Dismissal of appeals by Customs, Excise and Gold (Control) Appellate Tribunal for failure to comply with pre-deposit order.2. Allegations of shortage of duty-free imported goods by the company leading to demand of customs duty, penalty, and interest.3. Failure to comply with Tribunal's order for deposit leading to dismissal of appeals.4. Argument for dispensing with the deposit due to financial difficulties.5. Interpretation of Section 129-E of the Customs Act regarding mandatory deposit for appeals.Analysis:1. The judgment deals with a writ petition challenging the dismissal of appeals by the Customs, Excise and Gold (Control) Appellate Tribunal due to the petitioners' failure to comply with the pre-deposit order issued on 20 April 2001. The Tribunal had directed the petitioner company and its Managing Director to deposit specific amounts as a condition for stay of the remaining demand and for the hearing of their appeals.2. The case involves allegations of a shortage of duty-free imported capital goods, spares, etc., by the company, as discovered during a visit by Central Excise officers. The adjudicating authority confirmed the demand of customs duty, penalty, and interest under the Customs Act, 1962, based on the shortage. Additionally, a penalty was imposed on the Managing Director under Section 112 of the Act. The petitioners appealed to the Tribunal, seeking a stay of the demand.3. Despite the Tribunal's order for deposit, the petitioners failed to comply, resulting in the dismissal of their appeals. The Managing Director argued for dispensing with the deposit due to financial constraints, but the Court found no grounds for interference with the Tribunal's decision. The Court emphasized the mandatory nature of the deposit requirement for entertaining appeals under Section 129-E of the Act.4. During the hearing, the Managing Director expressed inability to deposit further amounts and requested restoration of their appeals without additional deposits. However, the Court held that the right to appeal is not absolute and can be subject to pre-conditions set by the Legislature. The Court highlighted the discretionary power of the appellate authority to dispense with the deposit in cases of undue hardship, while safeguarding the Revenue's interests.5. Ultimately, the Court concluded that the financial difficulty alone was not sufficient to grant an unconditional stay and dismissed the writ petition, upholding the Tribunal's decision. The judgment underscores the importance of complying with statutory requirements for appeals, balancing the rights of appellants with the need to protect revenue interests.