TaxTMI 
TaxTMI 
2007 (9) TMI 274
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.... filed. The Tribunal in terms of its order dated 14-1-2004 opined : "We accordingly order that the appellant company deposit Rs. 3 crores out of the total duty demand upon such deposit further deposit of duty and penalty imposed on the company is waived and recovery thereof stayed. We further order that the director of the company Shri R.C. Agarwal deposit Rs. 20 lakhs and the power of attorney holder of the Company Shri H.R. Agarwal deposit Rs. 10 lakhs within 12 weeks of the date of the order. Compliance on 26-4-2004. Appeal is liable to be rejected for non-compliance without further notice." 5. A writ application filed by the appellants questioning the correctness of the said order-has been dismissed by reason of the impugned judgment. 6. Mr. C.N. Sreekumar, learned Counsel appearing on behalf of the appellants, in support of this appeal, inter alia would submit : (i) The High Court committed a manifest error insofar as it failed to take into consideration the ingredients of Section 129E of the Act. (ii) Section 129E, if construed properly, would not give rise to a conclusion that in a....
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....s a right of appeal is a statutory right, it may also be hedged by conditions. It is, however, trite that conditions imposed may not be such which may for all intent and purport take away a vested right of appeal. [See Dilip S. Dahanukar v. Kotak Mahindra Co. Ltd. & Anr., 2007 (5) SCALE 452] 10. We, however, having regard to the facts and circumstances of this case are of the opinion that the larger question, viz., interpretation of Section 129E of the Act need not be gone into. Section 129E of the Act would be attracted where the goods in question are not in the custody of the Revenue. The said provision, therefore, would be attracted only when the ingredients thereof exist. The learned Additional Solicitor General very fairly submits that a part of the goods is in custody of the respondents. If that be so, in our opinion, it was obligatory on the part of the Tribunal to take that factor into consideration in making the order of pre-deposit. Furthermore, while exercising its jurisdiction, the Tribunal was also required to apply its mind in regard to the question of undue hardship on the part of the appellants upon considering existence of a prima facie case. Merit of the case o....
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....the Act gives a discretion to the Tribunal in cases of undue hardships to condone the obligation to deposit or to reduce. It is a discretion vested in an obligation to act judicially and properly." 13. Mr. Sree Kumar, however, submits that inter alia having regard to the decision of the Madhya Pradesh High Court in Kishori Pujari Granite Pvt. Ltd. v. Union of India [2005 (184) E.L.T. 225] and the decision of the Kerala High Court in Ashoka Rubber Products v. Collector of C. Ex. [1989 (43) E.L.T. 605], the matter requires reconsideration. As at present advised, we are not inclined to do so. 14. We are satisfied that in a case of this nature, where a part of the goods which is the subject matter of the proceedings under the Act is in possession of the Revenue, proviso appended to Section 129E of the Act should have been invoked. 15. Justification for enacting such a provision has been considered by a Constitution Bench of this Court in Mardia Chemicals Ltd. and Others v. Union of India and Others [(2004) 4 SCC 311] wherein it was held : "56. The contention of the petitioners is that in the first place such an oppressive provision should not have been made at all. It works as a de....
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....will leave the borrower in a position where it would not be possible for him to raise any funds to make deposit of 75% of the undetermined demand. Such conditions are not alone onerous and oppressive but also unreasonable and arbitrary. Therefore, in our view, sub-section (2) of Section 17 of the Act is unreasonable, arbitrary and violative of Article 14 of the Constitution." 16. The Constitution Bench, therefore, was of the opinion that such a condition would be onerous and, thus, arbitrary if a suitor is required to deposit such an amount at the initial stage and not at the appellate stage. 17. We are not oblivious that the taxing statute must be strictly construed. [See Manish Maheshwari v. Asstt. Commissioner of Income Tax and Anr., 2007 (3) SCALE 627 and Southern Petrochemical Industries Co. Ltd. v. Electricity Inspector and E.T.I.O. and Ors., 2007 (7) SCALE 392] We are also not oblivious of the fact that only because the word "shall" is used, the same may not be construed to be imperative in character. In Management, Pandiyan Roadways Corp. Ltd. v. N. Balakrishnan [2007 (7) SCALE 758], this Court observed : "12. On a plain reading of the said provision and particularly i....