2015 (2) TMI 925 - HC - Central Excise

Waiver of pre deposit - Clandestine removal of goods - Financial hardship - Held that - Tribunal has considered the prima facie case and also the plea of financial hardship expressed by the appellant and taking into consideration the quantum of demand of ₹ 3,02,08,777, had ordered pre-deposit to the tune of ₹ 1 Crore only as pre-condition for hearing the appeal. However, though modification was sought for on the same set of arguments, the Tribunal thought it fit not to modify the order. The Tribunal has further observed that, the said amount having not been deposited and the order having not been complied with, and even on enquiry by the Tribunal on the question of extension of time for making the pre-deposit, the counsel for the appellant having submitted that the appellant is not in a position to make the pre-deposit, the Tribunal thought it fit to dismiss the appeal. In view of the well considered order of the Tribunal, wherein the prima facie case and financial hardship of the appellant were taken into consideration while ordering pre-deposit, which order has not been complied with, the bona fide of the appellant in filing the appeal now itself is in question. In such view of the matter, this Court finds no reason to interfere with the order of the Tribunal at this point of time, more so when the issue has become stale by efflux of time. The appellant is unable to point out any question of law that warrants consideration by this Court to justify this appeal. Nevertheless, we find no question of law, much less substantial question of law that arise for consideration in this appeal - No merit in appeal - Decided against assessee.

Summary

Issues:
1. Tribunal's directive for pre-deposit without considering the case on merits.
2. Tribunal's rejection of application for waiver of pre-deposit without considering undue hardship.

Analysis:
1. The appellant, engaged in manufacturing detergent cakes and washing powder, received a show cause notice for alleged clandestine removal of goods. The Tribunal ordered a pre-deposit of Rs. 1 Crore before hearing the appeal, considering the prima facie case and financial hardship expressed by the appellant. The Tribunal justified this decision based on the evidence provided regarding the MRP and sales reports of the goods. The appellant failed to comply with this order, leading to the dismissal of the appeal. Despite seeking modification of the order, the Tribunal declined, citing the non-compliance and dismissed the appeal due to statutory requirements under Section 35F of the Central Excise Act, 1944.

2. The appellant's plea for waiver of pre-deposit based on undue hardship was not considered by the Tribunal during the initial order or the subsequent modification request. The Tribunal emphasized the importance of compliance with statutory requirements and declined any extension for depositing the specified amount. The appellant's inability to deposit the required sum led to the dismissal of the appeal. The High Court, upon review, found no substantial question of law to warrant interference with the Tribunal's decision. The Court noted the lack of compliance with the pre-deposit order and the delay in pursuing the matter, ultimately dismissing the appeal and the connected miscellaneous petition.

In conclusion, the High Court upheld the Tribunal's decision, emphasizing the importance of complying with pre-deposit orders and statutory requirements under the Central Excise Act. The Court found no valid reason to overturn the Tribunal's orders, considering the appellant's non-compliance and lack of substantial legal issues raised.