2018 (7) TMI 1609 - HC - Customs

Dismissal of appeal on delayed filing - Service of order not made - pre-deposit condition of filing appeal not complied with - Detention of goods belonging to the petitioner by the Officers of Customs and/or Officers of Central Excise all over India - It is the specific case of the petitioner that on further inquiry from the department, it appears that even the department does not have any proof that the order dated 13th September 2012 is served on the petitioner. Held that - The right of Appeal is a creature of a statute and legislature is yet within its power to confer such a right subject to stipulation and conditions as long as they are not so onerous so as to amount to be unreasonable restriction on exercise of such right and making it illusory. Since right of Appeal cannot be claimed as an absolute right, it is necessarily to be exercised in the manner in which it can be availed as provided in a statute. Since it is a statutory right, it can be circumscribed by the conditions in its grant - If a statute enumerates certain conditions and provides that only on compliance of certain conditions, the right of Appeal available under the statute can be availed, then it is imperative that those conditions/stipulations must be strictly adhered to and complied with. Section 129 provides conditional right of Appeal in respect of an Appeal against the duty demanded or penalty levied - If the mandate of the statute requires to make pre-deposit of some amount as a condition precedent, entertainment of an appeal by the appellate authority, then, compliance of the said condition is mandatory and we need not dilate on the settled positiion, which is also not disputed by the learned counsel for the petitioner. It is apparent from record that when the petitioner filed an appeal, the address that was tendered was at G.I.D.C, Makapur, Baroda and when the order is passed on 12th September 2012, the said order has been forwarded to the petitioner at the same address i.e. M/s.India Medtronic Pvt. Ltd, 919/2, GIDC Estate, Makarpura, Baroda 390 010, and also to the Willingdon and Associates, Trident C Block, 3rd floor, Opp GERI Compound, Race Course, Vadodara - It is thus clear that the said order which has been passed on 13th September 2012 making the condition of deposit of 50% amount as a condition precedent for hearing of appeal and in absence of which directing its dismissal was never communicated to the petitioner. Thus, the petitioner was never made aware of the fact that the Appeal filed by him resulted into a dismissal on expiry of period of two weeks from 12th September 2012. The interest of justice would be served if the appeal filed by the petitioner is restored to its file and the Commissioner is directed to decide the same on its own merits - appeal restored.

Issues Involved:
1. Detention order and recovery of dues.
2. Provisional and final assessment of imported goods.
3. Denial of exemption benefit under notification.
4. Appeal against the Order-in-Original.
5. Non-compliance with interim orders.
6. Service of orders and procedural fairness.
7. Restoration of appeal and compliance with statutory requirements.

Detailed Analysis:

1. Detention Order and Recovery of Dues:
The petitioner company, engaged in trading medical devices, challenged the detention order dated 28th September 2017, issued by the Deputy Commissioner of Customs. The order directed the recovery of ?29,41,301 along with interest by detaining and selling any goods belonging to the petitioner.

2. Provisional and Final Assessment of Imported Goods:
The petitioner imported A & V Plastic Tubings, claiming exemption under notification 17/2001-CUS dated 1st March 2001. The goods were initially assessed provisionally at a nil rate of duty. However, the final assessment by the Deputy Commissioner of Customs denied the exemption, stating that the tubings, although of medical grade, were in running length and required cutting to be usable as accessories for medical machines.

3. Denial of Exemption Benefit Under Notification:
The Order-in-Original concluded that the A.V. Tubings in running length were not complete accessories but intermediate products, thus not qualifying for the exemption under the said notification.

4. Appeal Against the Order-in-Original:
The petitioner appealed against the Order-in-Original dated 21st August 2009 to the Commissioner of Customs (Appeals), along with an application for stay and waiver of pre-deposit. The appeal cited financial hardship and requested the setting aside of the impugned order.

5. Non-Compliance with Interim Orders:
The Commissioner of Customs (Appeals) initially directed the petitioner to deposit the confirmed demand within one week. Upon reconsideration, the order was modified on 16th June 2012, requiring a 50% deposit of the confirmed demand within two months. The petitioner failed to comply, leading to further directions on 13th September 2012, which the petitioner claimed was never served.

6. Service of Orders and Procedural Fairness:
The petitioner argued that the order dated 13th September 2012 was not received, and thus, they were unaware of the requirement to deposit 50% of the demand. The petitioner only discovered the order through an RTI application in May 2017. The Revenue's affidavit did not provide proof of service of the order, supporting the petitioner's claim.

7. Restoration of Appeal and Compliance with Statutory Requirements:
The petitioner eventually deposited ?14,71,651 on 12th June 2018, complying with the interim order. The court found merit in the petitioner's argument that the order was not communicated, and thus, the appeal was deemed dismissed without their knowledge. The court restored the appeal and directed the Commissioner of Customs (Appeals) to decide it on merits within two months.

Conclusion:
The court ordered the restoration of the appeal against the Order-in-Original and directed the Commissioner of Customs (Appeals) to decide the appeal afresh, ensuring procedural fairness and compliance with statutory requirements. The detention order was deemed premature and the appeal was to be heard on its merits.

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