2012 (11) TMI 734 - HC - Customs

Duty, penalty and interest - application under Section 129E of the Customs Act, 1962, seeking waiver of pre-deposit Held that - Petitioner has good case on merits - petitioner has already deposited a sum of Rs. 85,48,462.40 ps. towards pre-deposit. Since the petitioner is not liable to pay any amount as per the order at Annexure-F, the direction of the Appellate Tribunal to deposit the amount in a sum of Rs. 2.5 crores towards pre-deposit is unreasonable -respondent is directed not to recover the balance of the disputed tax

Summary

Issues:
1. Validity of the order passed by the Appellate Tribunal directing the petitioner to deposit a sum of Rs. 2.5 crores within 10 weeks.
2. Justification of the direction given by the Appellate Tribunal for pre-deposit in terms of the Order-in-Original.
3. Prima facie case for waiver of pre-deposit in Appeal No. C/216/2010.

Analysis:
1. The petitioner challenged the order of the Appellate Tribunal directing the deposit of Rs. 2.5 crores within 10 weeks. The petitioner argued that since they had already deposited a significant amount towards pre-deposit, the direction to deposit an additional sum was unreasonable. The respondent, on the other hand, supported the impugned order, stating that the petitioner must comply with the Tribunal's direction based on the Order-in-Original.

2. The Appellate Tribunal, in its findings, acknowledged that the petitioner, involved in processing imported materials, had a prima facie case for waiver of pre-deposit in Appeal No. C/216/2010. Despite this, the Tribunal directed the petitioner to deposit Rs. 2.5 crores within 10 weeks. The Court noted that the petitioner had already deposited a substantial sum towards pre-deposit and directed the Tribunal to dispose of the appeals within four weeks from the date of the Court's order. Pending disposal, the respondent was restrained from recovering the balance of the disputed tax, subject to the Tribunal's final decision.

3. The Court emphasized the need for the Appellate Tribunal to expedite the appeal process, considering the petitioner's prima facie case and the amount already deposited. The Court's decision aimed to ensure a fair and timely resolution of the appeals while providing temporary relief to the petitioner regarding the disputed tax recovery. The writ petition was disposed of without any costs, maintaining a balance between the interests of both parties involved in the legal dispute.