2006 (6) TMI 111 - HC - Service Tax

Tribunal has declined to restore the petitioner s appeal dismissed by it for non-prosecution order passed by the Tribunal regarding pre-deposit and furnishing of bank guarantee had been complied with by the petitioner within the time - notice regarding hearing of the appeal does not appear to have been served upon the petitioner - dismissal of the appeal for non-prosecution was not justified - order passed by Tribunal should have been recalled and the appeal heard and disposed of on merits

Summary

Issues:
1. Appeal dismissed for non-prosecution by Customs, Excise and Service Tax Appellate Tribunal.
2. Compliance with pre-deposit and bank guarantee requirements.
3. Alleged non-receipt of notice for hearing.
4. Delay in filing application for restoration of appeal.

Analysis:
1. The petitioner's appeal was dismissed by the Customs, Excise and Service Tax Appellate Tribunal for non-prosecution. The petitioner contended that he had complied with the pre-deposit and bank guarantee conditions as directed by the Tribunal. However, the Tribunal dismissed the application for restoration citing non-appearance and a delay of five years in filing the application.

2. The petitioner argued that he had indeed deposited the required amount and furnished the bank guarantee within the stipulated time. It was further claimed that the consultant, to whom the compliance details were conveyed, failed to inform the Tribunal. The High Court found merit in this submission and held that the Tribunal erred in concluding non-compliance. The Court emphasized the importance of the departmental representative highlighting the compliance to avoid such dismissals.

3. Regarding the alleged non-receipt of the notice for the hearing, the petitioner asserted that no such notice was served at the changed address, which had been duly communicated to the Tribunal. The Court acknowledged the communication gap due to the consultant's death and the change in address. It was noted that the dismissal for non-prosecution was unwarranted in light of these circumstances.

4. Despite the delay in filing the application for restoration, the Court considered the circumstances leading to the delay. The petitioner was under a genuine impression that the appeal was pending, as evidenced by the bank guarantee extension. The Court highlighted the petitioner's efforts to comply and the misleading impression given by the Department. The petitioner was directed to pay costs for restoration and keep the bank guarantee valid until the final disposal of the appeal.

In conclusion, the High Court allowed the writ petition, set aside the Tribunal's order, and granted restoration of the appeal, emphasizing the need for compliance with the specified directions and timely actions to avoid dismissals for non-prosecution.