2007 (3) TMI 247 - HC - Central Excise

Tribunal has rejected the prayer for waiver without taking into account the fact that the petitioner company is a sick company under the provisions of Sick Industrial Companies (Special Provisions) Act, 1985 and the proceedings are pending before the Board of Industrial & Financial Reconstruction (BIFR) in view of precedents on the issue, impugned order could not be sustained and it deserves to be set-aside and is hereby set-aside. Accordingly, this writ petition is allowed

Summary

Issues:
1. Refusal to waive statutory condition of pre-deposit by the Customs, Excise and Service Tax Appellate Tribunal.
2. Consideration of the petitioner as a sick company under the Sick Industrial Companies (Special Provisions) Act, 1985.
3. Comparison with a similar case where the petition was dismissed by a Single Judge.
4. Distinction between the present case and the previously dismissed case.
5. Setting aside the impugned order and allowing the writ petition for the petitioner to renew the prayer for waiver of the pre-deposit.

Detailed Analysis:
1. The High Court judgment was based on a petition against the order of the Customs, Excise and Service Tax Appellate Tribunal, which refused to waive the statutory condition of pre-deposit for the petitioner. The Tribunal directed the petitioner to deposit the entire duty demand within a specified period, with the penalty pre-deposit requirement being waived upon such deposit.

2. The petitioner, represented by learned senior counsel, argued that the Tribunal failed to consider that the petitioner company was classified as a sick company under the Sick Industrial Companies (Special Provisions) Act, 1985. Citing relevant Supreme Court decisions, the counsel contended that the Tribunal's order was legally unsustainable.

3. The Assistant Solicitor General for respondents referred to a similar case where a petition against the Tribunal's order was dismissed by a Single Judge. The argument was made to maintain parity and dismiss the present writ petition.

4. In response, the petitioner's counsel highlighted distinctions between the present case and the previously dismissed case. It was pointed out that an intra-court appeal was filed against the earlier order, which was pending before the Division Bench, and the petitioner in that case was not a sick industry with no proceedings pending before the BIFR.

5. The High Court, after considering the arguments and the precedents cited, set aside the impugned order of the Tribunal. The Court allowed the writ petition, granting the petitioner the opportunity to renew the prayer for waiver of the pre-deposit, to be considered and decided by the Tribunal in accordance with the law. The judgment concluded by allowing the writ petition, with no order as to costs, and directed for compliance on payment of usual charges.