2015 (10) TMI 1131 - AT - Central Excise

Waiver of pre deposit - Denial of exemption claim - Held that - We have very limited scope at this stage to appreciate merits of each other. Therefore, to grant early opportunity of hearing to appellant, and to do justice to both sides, appellant is directed to make a predeposit of ₹ 1,00,00,000 in five equal monthly instalments of ₹ 20 lakhs each by 30 th of each month. The first instalment shall be paid by 30.5.2015 and thereafter by 30 th of subsequent four months. Within a week of such deposit, appellant shall submit copies of challans as proof of deposit to the adjudicating authority, Commissioner (Appeals) and office of learned CDR to ensure that compliance has been made to the direction above. Failure to make deposit of any of the instalments, shall render this order vacated and appeals stand dismissed. - Decided conditionally in favour of assessee.

Summary

Issues involved: Predeposit requirement in tax appeal, interpretation of exemption notification conditions, authority of appellate tribunal to remand appeals.

Analysis:

1. Predeposit Requirement: The appellant argued that they were deprived of justice when directed to deposit 50% of the demand, leading to the dismissal of their appeal for non-compliance with the stay order. The counsel emphasized the need for a fair hearing without arbitrary adjudication by the Revenue. The appellant requested a waiver of predeposit to have a reasonable opportunity of hearing before the Commissioner (Appeals).

2. Interpretation of Exemption Notification: The Revenue contended that the appellant violated the conditions of the notification by exporting granite blocks instead of manufacturing articles of granites for exports. They disputed the appellant's claim that their capital goods were under Revenue's control, stating that the goods were in the mining area without actual supervision by Revenue. The Revenue argued that the appellant's reliance on Section 129E of the Customs Act was unfounded.

3. Appellate Tribunal Decision: After hearing both sides and examining the records, the Tribunal acknowledged the limited scope to assess merits at that stage. To ensure a fair opportunity for the appellant, they directed a predeposit of Rs. 1,00,00,000 in five monthly installments. The Tribunal specified the payment schedule and required proof of deposit to be submitted promptly. Failure to comply would result in the dismissal of the appeals.

4. Remand to Commissioner (Appeals): Upon the deposit of all installments, the appellant was instructed to request a hearing before the Commissioner (Appeals) who would then consider the deposits and issue a reasoned order on the case. The Tribunal disposed of the appeals by remanding them to the Commissioner (Appeals) for further proceedings based on the decisions and actions outlined in the judgment.