2015 (10) TMI 2611 - AT - Customs

Restoration of appeal - failure to make pre-deposit - Doctrine of merger - Held that - doctrine of merger is not hit in the facts and circumstances of the case. Firstly, the Tribunal had only passed an interim order for pre-deposit, the time of which was extended by the Hon ble High Court and upon violation of such pre-deposit condition, the appeal was dismissed by the Tribunal. As such, there is no consideration of merits either by this Tribunal or by the Hon ble High Court. Whether the Tribunal can allow restoration of the appeal when the time limit for making pre-deposit was specified by the High Court in its Order dated 17-4-2014 and there has been violation of this Order? - Held that - The Tribunal cannot go beyond the directions of the Hon ble High Court and restore the appeal. It may be emphasized that the Tribunal is not taking away the assessee s right of appeal. But the Tribunal ought to respect the time limit given by the High Court for pre-deposit. If Tribunal ignores the directions of the High Court it may not only lead to chaos but would also amount to judicial indiscipline. The Tribunal has become functus officio and has no jurisdiction to entertain the application for restoration of appeal in view of the clear violation of the Hon ble High Court Order to make the pre-deposit by 12-6-2014. Appeal dismissed.

Summary

Issues Involved:
1. Restoration of appeals dismissed for non-compliance with pre-deposit orders.
2. Application of the Doctrine of Merger.
3. Tribunal's jurisdiction to entertain restoration applications post-High Court order.

Issue-wise Detailed Analysis:

1. Restoration of Appeals Dismissed for Non-Compliance with Pre-Deposit Orders:
The appellant's appeals were dismissed for failing to make a pre-deposit of Rs. 16.5 lakhs as ordered by the Tribunal. The appellant cited financial difficulties and professional suspension as reasons for non-compliance. Despite arranging funds later and making the pre-deposit, the appellant sought restoration of the appeals. The Tribunal considered precedents where courts emphasized the sacrosanct nature of the right to appeal and the need for substantial justice. The Tribunal noted that delayed compliance, if sufficiently explained, could warrant restoration of appeals to ensure decisions on merits.

2. Application of the Doctrine of Merger:
The respondent argued that the Doctrine of Merger applied, rendering the Tribunal functus officio post the High Court's order. The High Court had extended the time for pre-deposit, which the appellant failed to comply with, leading to the dismissal of the appeals. The Tribunal examined the doctrine, noting that the High Court's extension of time did not address the merits of the case, and thus, the doctrine may not strictly apply. The Tribunal referenced various judicial pronouncements highlighting that the right to appeal should not be lightly taken away, and procedural lapses should not perpetuate injustice.

3. Tribunal's Jurisdiction to Entertain Restoration Applications Post-High Court Order:
The Tribunal was divided on whether it had jurisdiction to restore appeals after the High Court's specified time for pre-deposit was violated. One member opined that the Tribunal could restore the appeals, emphasizing the need for justice and the sacrosanct nature of the right to appeal. Another member argued that the Tribunal lacked jurisdiction post-High Court order, as the Tribunal had become functus officio. The third member, resolving the difference, concurred with the latter view, emphasizing adherence to the High Court's directives and judicial discipline.

Majority Order:
The majority concluded that the Tribunal had become functus officio due to the Doctrine of Merger and had no jurisdiction to entertain the restoration application after the appellant violated the High Court's order for pre-deposit by 12-6-2014. The restoration application was dismissed, upholding judicial discipline and the finality of the High Court's order.