2014 (4) TMI 1268 - HC - Central Excise

Maintainability of appeal - quantum of pre-deposit to be made by the appellants as a condition precedent for the hearing of the appeals - HELD THAT - The appellants are directed to deposit a sum of ₹ 25 lacs as a condition precedent for hearing of the appeals. Appeal disposed off.

Summary

Issues:
Delay in filing the appeal condonation, Quantum of pre-deposit for hearing the appeals.

Delay Condonation:
The judgment starts by condoning a delay of 108 days in filing the appeal. The appeal was filed under Section 35G of the Central Excise Act against the order passed by the Customs, Excise and Service Tax Appellate Tribunal. The appellants claimed substantial questions of law in the appeal.

Background and Facts:
The appellants are engaged in manufacturing parts of Excavator and loader machines, undertaking job-work operations, and processing goods for principal manufacturers. Following an inspection in July 2008, a show cause notice was issued in April 2010 proposing a demand of Rs. 1.52 crores. The demand was confirmed by the adjudicating authority in July 2011, along with penalties. The appellants appealed to the Tribunal, which directed a pre-deposit of Rs. 75 lacs by appellant No. 1 and Rs. 5 lacs by appellant No. 2 for hearing the appeals on merits.

Arguments and Tribunal's Decision:
The appellants argued that the demand could not exceed Rs. 60 lacs, and the pre-deposit amounts were unjustified and excessive. On the other hand, the respondents supported the Tribunal's order, considering it reasonable. The primary dispute centered on the quantum of pre-deposit required for hearing the appeals. After considering the arguments and facts, the appellants were directed to deposit Rs. 25 lacs as a condition precedent for hearing the appeals, reducing the initial pre-deposit amounts.

Disposition and Extension:
The appeal was disposed of accordingly. A prayer was made to extend the time for pre-deposit, which was allowed in the interest of justice. The appellants were granted an extension until 31-5-2014 to deposit the sum of Rs. 25 lacs. Compliance with this directive would ensure the appeals are heard on merits in accordance with the law.

This judgment primarily dealt with the condonation of a delay in filing the appeal and the determination of the pre-deposit amount required for hearing the appeals on merits. The court considered the arguments presented by both parties and adjusted the pre-deposit amount to Rs. 25 lacs, emphasizing fairness and justice in the proceedings.