2014 (4) TMI 56 - HC - Central Excise

Waiver of pre deposit - discrimination in stay order - tribunal directed the appellant to to deposit a sum of Rs.45 lakhs. - Tribunal further required two other entities to deposit Rs. 1 lakh and Rs. 50, 000/respectively. In case of rest of the appellants predeposit was completely waived. - Held that - From the impugned order of the tribunal dated 24.10.2013 we notice that no reasons are recorded by the tribunal for providing different yardsticks for predeposit in case of different entities. The petitioner is asked to deposit Rs. 45 lakhs as against the rest of entities in whose cases (barring two where predeposit requirement was Rs.1 lakh and Rs.50, 000/respectively) have not been asked to deposit any amount whatsoever. It is therefore not possible to appreciate on what basis the tribunal has made such distinction. Only on this short ground we are inclined to remand the proceedings before the tribunal for fresh consideration and disposal in accordance with law - rectification application would not survive - matter remanded back - Decided in favour of assessee.

Summary

Issues: Challenge to CESTAT order and rectification application regarding predeposit waiver

In this case, the petitioner challenged an order passed by the CESTAT on 24.10.2013, along with a subsequent order on 7.1.2014 regarding a rectification application. The main issue revolves around the condition of predeposit. The petitioner, an appellant before the tribunal, contested an order by the Commissioner confirming significant amounts of duty, interest, and penalty demands. The petitioner argued that the joint confirmation of these amounts against three individuals, including themselves, was impermissible. While the appeal was pending, the petitioner sought a waiver of predeposit. Other individuals facing similar confirmations also appealed and requested predeposit waivers. Notably, one of the jointly liable persons had already deposited Rs. 50 lakhs, leading the tribunal to consider this as sufficient predeposit. The tribunal then directed the petitioner to deposit Rs. 45 lakhs, while requiring two other entities to deposit Rs. 1 lakh and Rs. 50,000 each. Predeposit was entirely waived for the remaining appellants.

The petitioner subsequently filed a rectification application, which was dismissed, prompting the current petition. Upon reviewing the tribunal's order, the High Court noted the lack of reasons for the varying predeposit requirements among different entities. The tribunal's decision to ask the petitioner for Rs. 45 lakhs while exempting others from any deposit lacked clarity and justification. Consequently, the High Court decided to remand the proceedings back to the tribunal for fresh consideration and disposal in accordance with the law. The part of the order requiring the petitioner to deposit Rs. 45 lakhs as predeposit was quashed.

As a result, the order on the rectification application from 7.1.2014 was deemed invalid. The tribunal was instructed to reconsider the petitioner's application for predeposit waiver and issue a new order promptly and lawfully. The case was disposed of accordingly.