2015 (1) TMI 271 - HC - Central Excise

Waiver of pre deposit - Classification of the product Di Calcium Phosphate - Animal Feed Grade - chapter 23 or chapter 28 - Precedent decision distinguished - Held that - Tribunal has not delved into the aspect as to whether the assessee in the case of M/s. Sudeep Pharma Ltd. 2015 (1) TMI 296 - CESTAT AHMEDABAD was in any manner not similarly situated to the petitioner when it was the specific case of the petitioner that identical controversy was involved and that the petitioner was similarly situated to the said assessee. On a perusal of the show-cause notice issued in the case of the petitioner as well as in the case of M/s. Sudeep Pharma Ltd., a copy whereof has been placed on record, it is apparent that the controversy involved in both the cases was identical. In the order passed in the case of M/s. Sudeep Pharma Ltd., the Tribunal has not discussed on the aspect of financial hardship. The learned counsel for the respondents is not in a position to point out any notable difference in the case of the petitioner and in the case of M/s. Sudeep Pharma Ltd. Under the circumstances, the above referred decision of the Supreme Court in the case of Vishnu Traders v. State of Haryana (1993 (11) TMI 230 - SUPREME COURT) would be squarely applicable to the facts of the present case. The Tribunal, therefore, was not justified in discriminating between the petitioner and the other assessee by directing the petitioner to pre-deposit an amount which is much more than in other cases. Under the circumstances, adopting the same approach as in the case of Sudeep Pharma Ltd., the Tribunal ought to have directed predeposit of an amount of ₹ 8.5 lakhs. The impugned orders being contrary to the law laid down by the Supreme Court in the case of Vishnu Traders v. State of Haryana 1993 (11) TMI 230 - SUPREME COURT , therefore, cannot be sustained - Decided partly in favour of assessee.

Summary

Issues:
Controversy over directing petitioner to pre-deposit 10% of entire demand under order-in-original including duty and penalty compared to similar treatment to another assessee.

Analysis:

1. The petition challenged orders by the Customs, Excise & Service Tax Appellate Tribunal regarding pre-deposit requirements. The petitioner appealed against a duty demand confirmation and penalty under the Central Excise Act. The Tribunal initially directed a partial deposit, which the petitioner contested citing a similar case involving M/s. Sudeep Pharma Ltd. The Tribunal then rejected the stay application, prompting the petitioner to file the present petition.

2. The petitioner argued for similar treatment as in the case of M/s. Sudeep Pharma Ltd., citing a Supreme Court decision emphasizing equality in treatment for similarly situated persons. The respondent defended the Tribunal's decision, highlighting the need to balance undue hardship to the petitioner with safeguarding revenue interests. The Tribunal considered the issue debatable and imposed conditions based on the petitioner's financial status.

3. The main issue revolved around the Tribunal's directive for the petitioner to pre-deposit 10% of the entire demand, while a similar assessee was required to deposit only 10% of the duty demand within the limitation period. The Supreme Court's stance on consistency and uniformity in judicial discretion was crucial in this context.

4. The Court found the Tribunal's differentiation unjustified, as the cases were identical, and no significant financial hardship was evident. The Tribunal failed to justify the disparity in pre-deposit amounts between the petitioner and other assessees, contrary to the principles of consistent treatment outlined by the Supreme Court.

5. Consequently, the Court allowed the petition, quashing the impugned order and modifying the pre-deposit amount to align with the duty demand within the limitation period. The judgment emphasized adherence to established legal principles and consistency in judicial decision-making for fair treatment of all parties involved.