2018 (4) TMI 235 - AT - Customs

Restoration of petition - stay and waiver of pre-deposit - Held that - Karnataka high Court in the case of McDowell and Company Ltd. 2005 (4) TMI 77 - HIGH COURT OF KARNATAKA AT BANGALORE has held that the the jurisdiction of the Tribunal to review / modify its earlier stay order Tribunal after having exercised jurisdiction for the purposes of passing an order for waiver of predeposit under proviso to Section 35F of Central Excise Act, 1944 cannot modify that order subsequently like an appellate authority, nor can keep tinkering with such order as and when applications for modification of the order are filed - ROM application being devoid of merit is set aside.

Summary

Issues:
1. Restoration petition under Section 129 of Customs Act, 1962 to set aside ex parte order.
2. Compliance with predeposit order and subsequent dismissal of appeal.
3. Tribunal's power to modify stay order.
4. Applicability of cited legal precedents in the case.

Analysis:
1. The appellant filed a restoration petition under Section 129 of Customs Act, 1962 to set aside an ex parte order passed by the Tribunal. The appellant had initially filed an appeal for stay and waiver of predeposit, which was granted with a direction to deposit an amount of ?10 crores. Subsequent petitions for modifying the predeposit order and producing additional evidence were filed. However, due to a bail petition, the appellant's counsel failed to appear before the Tribunal, resulting in the dismissal of the miscellaneous application and the appeal. The appellant argued that evidence had been produced to prove the allegations regarding imports were baseless, and cited legal precedents in support of the restoration petition.

2. The learned AR opposed the restoration petition, highlighting that the appellant failed to comply with the predeposit order of ?10 crores within the specified time frame. The Tribunal dismissed the appeal for non-compliance, noting that the appellant did not deposit the required amount even after the stay order. The AR emphasized that the Tribunal's order was based on careful consideration of submissions and that the appellant had the option to appeal to the High Court against the stay order. Citing legal precedents, the AR argued against the Tribunal's power to review or modify its earlier orders regarding predeposits.

3. After considering submissions from both parties and reviewing the record, the Tribunal found that the appellant had not complied with the predeposit order and failed to appear for the modification application hearings. The Tribunal held that it did not have the inherent power to modify the stay order once passed, and the appellant's reliance on legal precedents was deemed inapplicable to the case. Following the decision of the Karnataka High Court, the Tribunal dismissed the restoration petition, stating it lacked merit in the present circumstances.

4. The Tribunal's decision was based on the non-compliance with the predeposit order, the lack of appearance during modification application hearings, and the limitation on the Tribunal's power to modify stay orders. The legal precedents cited by both parties were considered, with the Tribunal ultimately relying on the decision of the Karnataka High Court to dismiss the restoration petition due to its lack of merit in the case.

This detailed analysis covers the issues involved in the legal judgment comprehensively, providing insights into the arguments presented by both sides and the Tribunal's reasoning for its decision.