2013 (6) TMI 54 - HC - Service Tax

Stay - dismissal of petition for non deposit of predeposit - matter pending since 2006 - the petitioners deposited sum of Rs. 10 lakh along with interest for interregnum period before the Tribunal sometime in December 2012. Having made such deposit the petitioners once again approached the Tribunal for restoration of the appeals. Such applications however came to be dismissed by impugned order dated 10.1.2013. - held that - we are of the opinion that the petitioners should be given an opportunity to pursue their appeals before the Tribunal on merits. It is of course true that the Tribunal required a pre-deposit of Rs.10 lakh way back in the year 2006 and such amount was deposited only in December 2012. However we cannot lose sight of the fact that the petitioners in the meantime were all along pursuing their remedy questioning the very requirement of pre-deposit condition imposed by the Tribunal. When the petitioners have fully made good the pre-deposit amount along with interest for a considerable period that last in between we are of the opinion that the petitioners appeal should be heard on merits. - matter restored before tribunal.

Summary

Issues: Challenge to order of Customs, Excise & Service Tax Appellate Tribunal (CESTAT) for refusal to restore appeals due to non-compliance with pre-deposit requirement.

In this case, the petitioners had filed appeals before CESTAT challenging an order of the Commissioner of Central Excise. The Tribunal directed the petitioners to deposit Rs. 10 lakh as a pre-deposit, failing which their appeals were dismissed. Subsequently, their restoration application seeking waiver of the pre-deposit was also rejected. The petitioners then approached the High Court, but later withdrew the petition to avail alternative remedy. They filed new appeals which were also dismissed. The petitioners eventually deposited the required amount in December 2012 and sought restoration of the appeals, which was again dismissed on 10.1.2013.

The High Court, after considering the circumstances, noted that the petitioners had been consistently pursuing their remedy challenging the pre-deposit requirement imposed by the Tribunal. Despite facing dismissals, the petitioners continued their efforts and eventually made the deposit in December 2012. The Court acknowledged the difficulties faced by the petitioners in raising the funds, especially when their factory was not operational. The Court recognized the efforts made by the petitioners and decided to restore the appeals before the Tribunal for a hearing on merits. The Court emphasized that since the pre-deposit was now fulfilled, the petitioners should be given the opportunity to pursue their appeals. The Court exercised its writ jurisdiction to restore the appeals and directed the Tribunal to hear the appeals on merits. The petition was disposed of with these directions.