2021 (4) TMI 634 - AT - Customs

Maintainability of appeal - requirement with the condition of pre-deposit - Smuggling - Absolute Confiscation - prohibited sandal woods - Section 129E of the Customs Act - HELD THAT - The pre-deposit of entire 10% of the demand under challenge has been made which includes 7.5% thereof as was required to be deposited at the time of filing appeal before Commissioner (Appeals) and 2.5% thereof as is required at the time of filing appeal before this Tribunal. Further, keeping in view that there is no denial to the submission that no defect memo was given to the appellant nor any opportunity of being heard was ever provided, the same is held to be the non-compliance of principal of natural justice specifically that no one shall be condemned unheard . Hon ble Gujarat High Court in the matter of M/S. KLJ PLASTICIZERS LTD VERSUS COMMISSIONER OF CENTRAL EXCISE 2018 (9) TMI 1581 - GUJARAT HIGH COURT has held it is the settled law that the opportunity of personal hearing irrespective of the demand thereof has to be given by the courts/quasi judicial authorities to the parties to a Lis before them. The matter remanded to Commissioner (Appeals) with the directions to decide based upon the merits of the present case - appeal allowed by way of remand.

Summary

Issues:
1. Compliance with Section 129E of the Customs Act, 1962 for pre-deposit.
2. Violation of principles of natural justice - deficiency memo and opportunity of personal hearing.
3. Dismissal of appeal by Commissioner (Appeals) on technical grounds.
4. Remand of the matter for adjudication on merits.

Compliance with Section 129E:
The case involved the illegal export of prohibited sandalwoods concealed in tandoor and ceramic tiles. The appellant challenged the order-in-original for confiscation and penalty imposed on various parties. The appellant argued that post the order, compliance with Section 129E was made by depositing 7.5% and 2.5% of the confirmed demand. The Department acknowledged the payment of the entire pre-deposit amount. The Tribunal noted that the pre-deposit of 10% had been made, satisfying the requirements for filing appeals before the Commissioner (Appeals) and the Tribunal.

Violation of Principles of Natural Justice:
The appellant contended that no deficiency memo was issued, and no personal hearing opportunity was provided, violating the principles of natural justice. The Tribunal emphasized the importance of the right to be heard, citing a decision by the Hon'ble Gujarat High Court. It held that the non-compliance with the principle of natural justice, specifically "no one shall be condemned unheard," was evident in this case. The Tribunal stressed the necessity of providing an opportunity for a personal hearing to parties involved in legal proceedings.

Dismissal of Appeal on Technical Grounds:
The Commissioner (Appeals) had dismissed the appeal based on a technical ground, specifically the failure to make the mandatory pre-deposit as required by Section 129E of the Customs Act, 1962. The Tribunal noted that the appeal was disposed of without considering the merits of the case due to this technicality. It opined that since the pre-deposit had been made post the order under challenge, the matter should be remanded back to the Commissioner (Appeals) for adjudication on merits.

Remand for Adjudication on Merits:
After considering the arguments from both sides, the Tribunal held that the matter should be remanded to the Commissioner (Appeals) for a decision based on the merits of the case. The Tribunal directed the Commissioner (Appeals) to provide notice to the parties and an opportunity for a hearing. The decision was influenced by the need to ensure that the appellant's right to appeal was not lost even after fulfilling the pre-deposit condition. The Tribunal emphasized the importance of upholding the principles of natural justice and providing a fair hearing to all parties involved in legal proceedings.

In conclusion, the Tribunal allowed the appeal by way of remand, instructing the Commissioner (Appeals) to decide the case based on its merits within a specified timeframe, ensuring compliance with procedural requirements and principles of natural justice.