2009 (5) TMI 726 - AT - Central Excise

Summary

Issues:
1. Pre-deposit of penalty and duty amount.
2. Allegation of violation of natural justice.
3. Modus operandi of the appellant.
4. Compliance with the adjudication order.

Analysis:

Issue 1: Pre-deposit of penalty and duty amount
The appellant had deposited an amount of Rs. 6,58,053/- against a duty demand of Rs. 7,23,800/ and the difference was protected by a bank guarantee. The adjudicating authority directed the encashment of the bank guarantee for duty realization. The Revenue argued for pre-deposit of penalty levied against the appellant and the partner before hearing the appeal. The Tribunal considered the conduct of the appellant and directed a deposit of Rs. 3 lakhs within six weeks, emphasizing the need to protect the interest of Revenue as per legal precedents.

Issue 2: Allegation of violation of natural justice
The appellant claimed a violation of natural justice as the adjudication was done ex parte without giving an opportunity to present their case. The Tribunal noted that the appellant had been given ample opportunities since 2008 but failed to respond to the show cause notice, causing delays in the proceedings. Despite the appellant's arguments, the Tribunal found their conduct questionable and directed compliance with the deposit within a specified time frame.

Issue 3: Modus operandi of the appellant
The Department highlighted the modus operandi of the appellant before the adjudicating authority, emphasizing evidence under Section 108 of the Customs Act, 1962. The Revenue contended that the appellant's method should be penalized for bringing charges against them. The Tribunal considered the evidence presented and directed the appellant to make the necessary deposit before the Commissioner for a fresh hearing.

Issue 4: Compliance with the adjudication order
The Tribunal dismissed the stay application but granted a limited remand, directing compliance with the deposit of Rs. 3 lakhs. This compliance was deemed essential to protect the interests of Revenue, as per legal precedents cited in the judgment. The Tribunal concluded by remanding both appeals and ensuring no further deposit by the partner for hearing his appeal.

This detailed analysis of the judgment highlights the key issues addressed by the Appellate Tribunal CESTAT, NEW DELHI, providing a comprehensive understanding of the decision and its legal implications.