2018 (12) TMI 1292 - HC - Central Excise

Restoration of appeal - appeal was dismissed for non-deposit of the statutory amount - Section 35F of the Central Excise Act, 1944 r/w Section 83 of the Act - Held that - Where an appeal is dismissed for non-deposit and such deposit if made within a reasonable time of dismissal then, the appellate authority should exercise its inherent power to recall the order of dismissal and hear the petitioner s application on merits. This is a procedural review and not a review on merits of the case - Therefore, even in the absence of such power of recall being provided in the statute, every quasi judcial authority has inherent powers to exercise this power of recall in its inherent jurisdiction in the interest of justice. The appeal of the petitioner is restored to the file of respondent no.2 Commissioner (Appeals).

Summary

Issues:
Challenge to order rejecting restoration of appeal dismissed for non-deposit of statutory amount under Section 35F of Excise Act and Section 83 of the Act.

Analysis:
The petitioner filed an appeal under Section 84 of the Finance Act, 1994, challenging an order dated 18th January, 2018. The appeal was dismissed on 17th May, 2018, due to non-deposit of the statutory amount as required by Section 35F of the Central Excise Act, 1944, read with Section 83 of the Act. Subsequently, on 28th August, 2018, the petitioner fulfilled the predeposit requirement and applied for restoration of the appeal, seeking a decision on merits. However, the respondent no.2 rejected the application on the grounds of lacking the power to restore a dismissed appeal without any statutory provision for recall. The respondent no.2 emphasized that the appeal cannot be entertained until the required statutory amount is deposited by the appellant.

The High Court analyzed the provisions of Section 84 of the Act and noted that there is no explicit bar on filing an appeal without making the pre-deposit. Comparing this with Section 107(6) of the Central Goods and Services Act, 2017, which prohibits appeal filing without the necessary deposit, the court observed that Section 35F of the Excise Act only bars the appellate authority from entertaining the appeal, not from filing it. The court concluded that if the deposit is made within a reasonable time after dismissal, the appellate authority should use its inherent power to recall the dismissal order and consider the appeal on its merits. Referring to the Supreme Court decision in Grindlays Bank Vs. Central Govt. Industrial Tribunal, 1980, the court emphasized that quasi-judicial authorities have inherent powers to recall orders in the interest of justice, even if not explicitly provided in the statute.

In light of the above analysis, the High Court quashed and set aside both the impugned order dated 17th September, 2018, and the order dated 17th May, 2018. The petitioner's appeal was restored to the file of the respondent no.2, the Commissioner (Appeals), to enable a decision on the appeal's merits in accordance with the law. The petition was disposed of accordingly, with no order as to costs.