2017 (4) TMI 137 - HC - Customs

Restoration of appeal - rejection on the ground that on 3-7-2015, the appeal itself was dismissed as withdrawn - Held that - It is an established principle of law that mistake of law or mistake in legal understanding of opinion of a counsel does not bind the party whom he or she represents or at least to the extent of causing irreparable prejudice. This is exactly what happened in this case. The appellant did not have any alternative remedy; yet the CESTAT permitted withdrawal of the appeal. In refusing to restore the appeal on the technical ground that the applicant s contention that there was no mandatory pre-deposit condition, the CESTAT merely compounded the injustice - the appeal preferred before the CESTAT i.e. ST No. 51757/2015-originally dismissed as withdrawn on 3-7-2015 should be restored to the file of the CESTAT - appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
Appeal for restoration of appeal dismissed as withdrawn by Customs, Excise and Service Tax Appellate Tribunal (CESTAT) due to failure to deposit required sum as pre-condition for hearing.

Analysis:
The appellant's grievance pertains to the rejection of their application for restoration of the appeal by the CESTAT. The appeal was initially withdrawn by the appellant's counsel due to the inability to deposit the required sum as a pre-condition for the hearing under the unamended Customs Act, 1962. Subsequently, realizing the lack of an alternative remedy, the appellant sought restoration of the appeal, which was denied by the CESTAT. The High Court emphasized the principle that a mistake of law or legal understanding by counsel should not prejudice the party represented. In this case, the appellant was erroneously allowed to withdraw the appeal despite having no alternative remedy, leading to injustice. The CESTAT's refusal to restore the appeal based on a technical ground regarding the pre-deposit condition was deemed unjust by the High Court.

The High Court, after hearing the arguments from both parties, concluded that the appeal dismissed as withdrawn by the CESTAT should be restored. The appellant was granted the liberty to file an application seeking exemption from the pre-deposit condition within two weeks, detailing any grounds of financial hardship. The CESTAT was directed to consider the application and make a decision accordingly. The High Court allowed the appeal to the extent of restoring it before the CESTAT for further proceedings.