TaxTMI 
TaxTMI 
2008 (2) TMI 811
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....tigations, it appeared that the appellant had received a total payment of Rs. 1,55,87,155/- during the period 1980 to 1987 from one Shri Ranjit Saha, a person resident in India, at the instructions of his uncle Shri Pabitra Saha of Mymensingh, Bangladesh, a person resident outside India. It also appeared that the said Lakshman Saha had made total payments to the tune of Rs. 1,51,92,935/- to various persons in India during the said period at the instructions of the said Shri Pabitra Saha of Bangladesh without any general or special permission from the Reserve Bank of India. It was further held that the receipt of total payments of Rs. 1,55,87,155/- and the making of payments of Rs. 1,51,92,935/- in the manner aforesaid was in contravention of the provisions of Section 9(1)(b) and Section 9(1)(d) respectively of the Foreign Exchange Regulation Act, 1973 and accordingly called for the imposition of a total penalty of Rs. 10 lakhs on the appellant to be paid at the office of the Enforcement Directorate, Calcutta Zonal Office, Calcutta by means of a demand draft drawn in the favour of the Deputy Director, Enforcement Directorate, Calcutta Zonal Office, Calcutta within 45 days of the rec....
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.... learned Single Judge of this Court on 31st May, 2005 when the following order was passed : In The High Court of Delhi at New Delhi W.P.(C) 10109/2005 lakshman C. Saha ....Petitioner Through Mr. J. Nedumpara Mathews, Adv. Versus Special Director of Enforcemen ....Respondent Through Mr. Rakesh Tiku, Adv. CORAM: Hon'ble Ms. Justice Gita Mittal Order 31-5-2005 Learned counsel for the petitioner submits that inasmuch as by a judicial pronouncement of this court, the proviso to Rule 5 of the notification reserving two posts of the Appellate Tribunal for Foreign Exchange for members of the Indian Legal Service has been held to be unconstitutional and void, the petitioner does not press prayer (iv) and leave is sought to withdraw the same. Leave granted. The writ petition is confined to consideration of prayers (i) to (iii) and (v) to (x). Issue notice to the respondents to show cause why rule nisi be not issued, returnable on 13th September, 2005. Mr. Rakesh Tiku, advocate accepts notice on behalf of the respondents and prays for time to file a reply. Let the reply be filed within four weeks. Rejoinder thereto within two weeks thereafter. ....
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....e appellant who has assailed the order of the learned Single Judge as cryptic and submitted before us that the appellant's failure to comply with the interim order can have only one consequence in law, i.e., that he will not be protected against the prosecution proceedings. Learned counsel for the respondent, on the other hand, sought to support the order on the ground that the appellant was involved in a Hawala transaction involving a sum of Rs. 1.55 crores on which he had earned a profit/commission of about Rs. 4 lakhs and that there was ample evidence in support thereof as evidenced by the order of the Enforcement Directorate, apart from the appellant's own statement of admission and the statement of the 17 persons to whom payments to the tune of about Rs. 1.51 crores had been made without any general or special permission from the Reserve Bank of India. All the recipients had named the appellant as the person from whom payments had been received by them. 9. The limited question which arises for consideration in the present appeal is whether the writ petition of the appellant, being WP(C) No.10109/2005 was liable to be dismissed for non-compliance of the order of pre-dep....
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....." 11. A bare glance at the provisions of sub-section (2) of Section 52 is sufficient to show that the pre-condition for the right to prefer an appeal to the Appellate Board is the deposit of the sum imposed by way of penalty under Section 50. The second proviso to sub-section (2), however, provides that where the Appellate Board is of the opinion that the deposit to be made will cause "undue hardship" to the appellant, it may, in its own discretion, dispense with such deposit either unconditionally or subject to such conditions as it may deem fit. 12. In a recent judgment, the Supreme Court in the case of Indu Nissan Oxo Chemicals Ind. Ltd. v. Union of India and Ors., 2008 (221) E.L.T. 7 (S.C.) = 2008 AIR SCW 151 while dealing with a similar provision in Section 129E of the Customs Act (52 of 1962) held that while dealing with the application for waiver of deposit pending appeal, twin requirements for consideration, i.e., consideration of undue hardship aspect and imposition of conditions to safeguard the interest of Revenue, have to be kept in view. Undue hardship is a matter within the special knowledge of the applicant for waiver of deposit pending appeal and ha....
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....ip" is given as unwarranted or inappropriate because excessive or disproportionate. Strouds Judicial Dictionary gives the following meaning to the word "undue hardship" as per judicial decisions cited therein : "For a hardship to be undue it must be shown in my opinion that the particular burden to the applicant to have to observe or perform the requirement is out of proportion to the nature of requirement itself and the benefit which the applicant would derive from compliance with it. (Re Walsh (1944) VLR 147). Again in Liberian Shipping Corpn Pegorus v. Kingsons (1967) 2 KB 86 it is given as But even if a claimant has been at fault himself, it is an undue hardship, if the consequences are out of proportion to his fault." 17. In Bank of Baroda v. Appellate Tribunal for Foreign Exchange, a Single Judge of this Court after noticing the legal provisions and the judicial pronouncements with regard to pre-deposit of amount involved in disposal of an appeal under Section 19 of the Foreign Exchange Management Act, 1999 observed as follows : "7. From the foregoing judicial pronouncements, as noted above, the position, which emerges is that the Tribunal while considering....
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....on'ble Supreme Court in Navin Chandra Chhotelal v. Central Board of Excise and Customs and Ors., 1981 (8) E.L.T. 679 (S.C.) = (1971) 1 SCC 289 held that where pre-deposit was not made in compliance with the provisions of the Section or with any order that may be passed thereunder, the Appellate Authority is fully competent to reject the appeal for non-compliance with the statutory provisions and in such a case the Appellate Authority cannot proceed to hear an appeal on merits. Paragraphs 18 and 19 of the judgment are apposite and are extracted below : "18. No doubt Section 129 does not expressly provide for the rejection of the appeal for non-compliance with the requirement regarding the deposit of penalty or duty, but when sub-section (1) of Section 129 makes it obligatory on an appellant to deposit the duty or penalty pending the appeal and if a party does not comply either with the main sub-section or with any order that may be passed under the proviso, the Appellate Authority is fully competent to reject the appeal for non-compliance with the provisions of Section 129(1). That is exactly what the first respondent has done in this case. Accepting the contention of Mr. Tr....
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.... an appeal against a tax or against a rateable value after a bill for any property tax assessed upon such value has been presented to him. Power at the same time is given to the appellate Judge to relieve the appellant from the rigour of the above provision in case the Judge is of the opinion that it would cause undue hardship to the appellant. The requirement about the deposit of the amount claimed as a condition precedent to the entertainment of an appeal which seeks to challenge the imposition or the quantum of that tax, in our opinion, has not the effect of nullifying the right of appeal, especially when we keep in view the fact that discretion is vested in the appellate Judge to dispense with the compliance of the above requirement. All that the statutory provision seeks to do is to regulate the exercise of the right of appeal. The object of the above provision is to keep in balance the right of appeal, which is conferred upon a person who is aggrieved with the demand of tax made from him, and the right of the Corporation to speedy recovery of the tax. The impugned provision accordingly confers a right of appeal and at the same time prevents the delay in the payment of the tax....
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....se an accompanying liability upon a party upon whom legal right is conferred or to prescribe conditions for the exercise of the right. Any requirement for the discharge of that liability or the fulfilment of that condition in case the party concerned seeks to avail of the said right is a valid piece of legislation, and we can discern no contravention of Article 14 in it. A disability or disadvantage arising out of a party's own default or omission cannot be taken to be tantamount to the creation of two classes offensive to Article 14 of the Constitution, especially when that disability or disadvantage operates upon all persons who make the default or omission." 21. A Full Bench of the Delhi High Court in Shri Shyam Kishore v. Municipal Corporation of Delhi and Ors., AIR (1991) Delhi 104 relying upon the judgment of the Supreme Court in Anant Mills Co. Ltd. v. State of Gujarat and Ors., (1975) 2 SCC 175 and the subsequent decision of the Supreme Court in Nand Lal v. State of Haryana, AIR 1980 SC 2097 on the same lines, affirmed that the right to appeal is a statutory right and can be circumscribed by the conditions in the grant and that there is no absolute right of appeal a....