2012 (9) TMI 880 - AT - Central Excise

Restoration of appeal - Held that - Appellants had challenged our Stay Order before Hon ble High Court of Gujarat, and their Lordships had not entertained the same and dismissed the Tax appeal. Since the appellant s challenge of our stay order has been dismissed by Hon ble High Court, we feel that nothing survives as subsequent request made by the appellants does not help to further his case, as, in his case, our order stands upheld by higher judicial forum. We are fortified in our view by the judgment of the Hon ble High Court of Delhi in the case of Commissioner of Customs vs. Lindt Exports & Ors. 2011 (9) TMI 609 - DELHI HIGH COURT , wherein identical facts were there and the Hon ble High Court has set-aside the order of the Tribunal, vide which we had restored an appeal, on deposit of the amount which was ordered to be pre-deposited. In our considered view, the judgment of Hon ble High Court of Delhi which was passed in the year 2012 being directly on the point as is in the facts of this case, hence, is directly applicable - Restoration denied.

Issues: Restoration of Appeal for non-compliance, Manufacturing process of dyeing of woven fabrics without payment of duty

In the present case, the Applicant filed an application for Restoration of Appeal, which was dismissed by the Tribunal for non-compliance. The Appellants were engaged in the manufacturing process of dyeing woven fabrics of cotton with power but were clearing the final products without duty payment, claiming that fixing color in a machine does not constitute manufacturing with power. A show-cause notice was issued, leading to duty liability confirmation and penalties imposition. The Tribunal directed the appellant to deposit Rs. 25 lakhs to hear the appeal, which was not complied with, resulting in dismissal. The Appellants challenged this in the High Court, but the appeal was dismissed. Subsequently, they withdrew their appeal from the Apex Court to seek Restoration of Appeal before the Tribunal by depositing the required amount. The Appellants argued that their compliance with the pre-deposit order entitled them to restoration, citing judgments from the High Court of Gujarat. However, the Tribunal found that the High Court's dismissal of the challenge to their stay order indicated no grounds for appeal restoration, referencing a similar case from the High Court of Delhi where appeal restoration was set aside. Consequently, the Tribunal dismissed the application for restoration of appeals, relying on the Delhi High Court judgment as directly applicable in this case.

This judgment primarily revolves around the issue of Restoration of Appeal for non-compliance with the Tribunal's pre-deposit order. The Tribunal noted that the Appellants failed to comply with the order, leading to the dismissal of the appeal. Despite the Appellants' argument that compliance entitled them to restoration, the Tribunal found that the High Court's dismissal of their challenge to the stay order indicated no basis for appeal restoration. The Tribunal's decision was influenced by a similar case from the High Court of Delhi, where appeal restoration was set aside, reinforcing the dismissal of the application for restoration in this case. The judgment underscores the significance of complying with Tribunal orders and the implications of higher court decisions on appeal restoration matters.

Another crucial issue in this judgment is the interpretation of judgments from the High Court of Gujarat and the High Court of Delhi regarding appeal restoration. The Appellants relied on High Court judgments to support their argument for restoration based on compliance with the pre-deposit order. However, the Tribunal differentiated the facts of this case from those in the cited judgments, particularly highlighting a Delhi High Court case where appeal restoration was denied under similar circumstances. By analyzing and applying the principles established in these High Court judgments, the Tribunal concluded that the Appellants did not meet the criteria for restoration of appeals in this case. This aspect of the judgment emphasizes the importance of legal precedent and its impact on the interpretation and application of laws in appeal restoration cases.

Furthermore, the judgment delves into the implications of challenging Tribunal orders in higher judicial forums. The Appellants had challenged the Tribunal's stay order in the High Court, which subsequently dismissed their appeal. The Tribunal considered this dismissal as a significant factor in rejecting the application for appeal restoration. By highlighting the consequences of challenging Tribunal decisions in higher courts, the judgment underscores the need for parties to carefully assess the potential outcomes and implications of such actions. This aspect of the judgment serves as a cautionary reminder of the legal repercussions of pursuing challenges to Tribunal orders in higher judicial forums without adequate grounds or merit.

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