2018 (11) TMI 724 - AT - Central Excise

Restoration of appeal - failure to comply with the requirement of pre-deposit prescribed in section 35F of Central Excise Act, 1944 - Held that - In the present instance, the applicant has deigned to initiate efforts to comply only upon exhausting the recourse to Hon ble High Court of Bombay which they found to be shut against them. It is a settled convention that a litigant cannot subject judicial mechanism to a test of chance and subject themselves to rule of law when the toss is against them. Even if they had been constrained by circumstances from meeting the pre-deposit requirement ordered by the Tribunal in full, partial compliance with application for modification before the Tribunal, or before the Hon ble High Court, would have been a proper demonstration of bonafides. In Kirtikumar Jawarharlal Shah v. Union of India 2014 (9) TMI 244 - SUPREME COURT OF INDIA the failure to diligently prosecute the appeal, evident from the casual manner of filing the application, was held to invalidate the right to appeal. That, too, is apparent in the present application which was not only filed after the period prescribed in law but also failed the test of diligence in seeking condonation when they did so. There is no justification for restoration of the appeal that had been dismissed for non-compliance - Application for restoration of appeal is dismissed.

Issues:
1. Restoration of appeal dismissed for failure to comply with pre-deposit requirement.
2. Consideration of belated compliance with pre-deposit.
3. Application for condonation of delay not listed due to non-compliance with pre-deposit.
4. Competence of Tribunal to consider compliance without specific liberty from High Court.
5. Precedents regarding restoration of appeals dismissed for non-compliance.
6. Impact of partial compliance and efforts to comply on restoration of appeal.
7. Denial of right to appeal due to lack of diligence in prosecuting the appeal.

Issue 1: Restoration of appeal dismissed for failure to comply with pre-deposit requirement

The application sought restoration of an appeal dismissed for not meeting the pre-deposit requirement under section 35F of the Central Excise Act, 1944. The appellant faced financial difficulties due to operational problems, preventing them from pursuing the appeal against the Commissioner's order. Despite seeking intervention from the High Court for waiver of compliance, the appeal was dismissed. The Tribunal was unwilling to consider the appeal without the prescribed pre-deposit, leading to the application for restoration.

Issue 2: Consideration of belated compliance with pre-deposit

The Tribunal deliberated on whether belated compliance with the pre-deposit could justify the plea in the application. Citing precedents, the Tribunal analyzed cases where partial compliance led to the grant of liberty to prosecute appeals. However, in this case, the applicant initiated compliance efforts only after exhausting options with the High Court, which closed the door for them. The Tribunal highlighted that technical lapses could not override substantial justice and emphasized the importance of demonstrating bonafides through partial compliance, which was lacking in this instance.

Issue 3: Application for condonation of delay not listed due to non-compliance with pre-deposit

An application for condonation of delay had also been made but was not listed due to deficiencies. The appeal was dismissed for non-compliance with the pre-deposit before the application for condonation could be addressed. The Tribunal noted the procedural shortcomings and the impact of non-compliance on the overall appeal restoration process.

Issue 4: Competence of Tribunal to consider compliance without specific liberty from High Court

The Authorized Representative argued that without specific liberty from the High Court to seek normal appellate remedy, the Tribunal lacked the competence to consider the present compliance with the pre-deposit. Citing a Gujarat High Court decision, the representative emphasized that once an order is merged into a High Court decision, seeking restoration without proper authorization is impermissible. The Tribunal considered the legal implications of such arguments in the context of the present case.

Issue 5: Precedents regarding restoration of appeals dismissed for non-compliance

Various legal precedents were cited to support arguments for or against the restoration of appeals dismissed for non-compliance. The Tribunal examined past judgments to understand the principles guiding such decisions, including the importance of substantial justice over technical considerations and the limitations on the Tribunal's authority in cases already disposed of by the High Court. These precedents played a crucial role in shaping the Tribunal's decision-making process.

Issue 6: Impact of partial compliance and efforts to comply on restoration of appeal

The Tribunal assessed the impact of partial compliance and the applicant's efforts to comply on the restoration of the appeal. It emphasized the significance of demonstrating bonafides through proactive steps to meet the pre-deposit requirements, highlighting the importance of diligence in pursuing legal remedies. The Tribunal considered whether the applicant's actions warranted restoration of the appeal despite initial non-compliance with the pre-deposit.

Issue 7: Denial of right to appeal due to lack of diligence in prosecuting the appeal

Drawing from legal precedent, the Tribunal discussed the implications of lack of diligence in prosecuting the appeal. It referenced a Supreme Court decision where failure to diligently prosecute the appeal invalidated the right to appeal. Applying this principle to the present case, the Tribunal found that the application not only missed the prescribed timeline but also lacked the required diligence in seeking condonation. This lack of diligence contributed to the denial of the restoration of the appeal.

In conclusion, the Tribunal dismissed the application for restoration of the appeal that had been previously dismissed for non-compliance with the pre-deposit requirement. The decision was based on a comprehensive analysis of the legal issues involved, including the applicant's belated compliance efforts, procedural deficiencies, precedents guiding appeal restoration, and the impact of lack of diligence in pursuing legal remedies. The Tribunal's decision underscored the importance of adhering to legal requirements and demonstrating bonafides in seeking appeal restoration.

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