2014 (2) TMI 1100 - HC - Central Excise

Waiver of pre-deposit of duty and penalty - Held that - since the Additional Commissioner Central Excise has adjudicated upon the issue of liability, at this stage there is no occasion to doubt it particularly by this Court where the issue is not for decision on merit. Therefore, in safeguard of the interest of the Revenue, we are of the view that the learned Tribunal has rightly exercised its discretionary power which does not require interference of this Court - Petitioner is permitted to make pre deposit in installments - Decided partly in favour of assessee.

Summary

Issues:
Appeal against stay order for pre-deposit of duty and penalty, Right of cross-examination, Discretionary power under Section 35 F of the Central Excise Act, 1944, Adjudication of liability by the Commissioner, Exercise of discretionary power by the Tribunal, Permission for delayed deposit of installments, Timeframe for appeal decision.

Analysis:
The judgment pertains to an appeal against a stay order issued by the Customs, Excise and Service Tax Appellate Tribunal, New Delhi, requiring the appellant to make a pre-deposit of Rupee fifteen lakh in three equal monthly installments. The appellant contested the demand for duty and penalty, claiming the right of cross-examination of a relevant individual. The appellant argued for the discretionary power under Section 35 F of the Central Excise Act, 1944, to waive the pre-deposit, citing previous court decisions supporting this stance.

The respondent, however, emphasized that the Commissioner had already adjudicated the liability, obligating the appellant to deposit the demanded amount to proceed with further adjudication. Citing legal precedent, the respondent highlighted the need to consider undue hardship and safeguarding revenue interests in such matters. The High Court, after considering both parties' arguments, upheld the Tribunal's exercise of discretionary power, noting the absence of grounds to doubt the Commissioner's decision on liability at that stage.

Regarding the issue of pre-deposit, the appellant sought permission for a delayed payment schedule due to financial constraints. The High Court granted permission for the delayed deposit of installments, allowing the appellant to pay the first installment within one month and subsequent installments in consecutive months as per the original order. The Court directed the Tribunal to decide on the appeal within four months, subject to the cooperation of the parties, thereby disposing of the appeal accordingly.