2017 (3) TMI 460 - HC - Central Excise

Pre-deposit of duty and penalty - Compounded levy scheme - for non compliance of the order passed by the 1st respondent, the earlier appeals preferred by the petitioner before the 1st respondent was dismissed for default - Held that - the pre-deposit amount of ₹ 25 lakhs ordered to be deposited by the 1st respondent had been deposited. In the circumstances, the impugned order passed by the 1st respondent dismissing the appeal for non compliance is hereby is set aside and the same is remanded back to the 1st respondent/tribunal for consideration afresh - appeal allowed by way of remand.

Summary

Issues:
1. Quashing of impugned order passed by the first respondent
2. Directing the first respondent to hear the main appeal on merits without insisting on pre-deposit of duty and penalty
3. Compliance with the order of the first respondent regarding pre-deposit of duty and penalty
4. Dismissal of appeals for default due to non-compliance

Analysis:
The petitioner, engaged in the manufacture of MS Ingots, operated under a compounded levy scheme from 1.9.97 to 31.3.2000, paying amounts as per Central Excise Act and Rules. Show Cause notices were issued demanding differential duty, penalty, and interest. Three appeals were filed against the orders, which were remanded for reconsideration. An Order-in-Original was passed demanding a sum towards duty, penalty, and interest. The petitioner appealed against this order, seeking waiver of pre-deposit. The first respondent directed a pre-deposit under Section 35F of the Central Excise Act, which the petitioner challenged through a Writ Petition. The petitioner sought to quash the order and direct a hearing on merits without pre-deposit. The High Court did not intervene, leading to the dismissal of the appeal by the first respondent. The petitioner then filed the present Writ Petition to quash the dismissal and proceed without pre-deposit.

The impugned order dismissed the petitioner's appeals for non-compliance with the pre-deposit directive. The petitioner filed the present writ petition to challenge this dismissal and request a hearing on merits without pre-deposit. The petitioner later informed the court that the pre-deposit amount had been paid. Consequently, the order dismissing the appeal for non-compliance was set aside, and the case was remanded to the first respondent/tribunal for fresh consideration. The first respondent was instructed to dispose of the appeal within three months from the date of the order. The Writ Petition was disposed of with this direction, and no costs were awarded.

In conclusion, the judgment addressed the issues of challenging the pre-deposit directive, dismissal of appeals for non-compliance, and the subsequent remand for fresh consideration. The court provided clarity on the legal obligations regarding pre-deposit and the consequences of non-compliance, ensuring a fair hearing on the merits for the petitioner within a specified timeline.