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Issues involved:
The issues involved in this case include the jurisdiction of Customs Authorities to initiate proceedings for violation of import license conditions, the discretion of the appellate authority under Section 129E of the Customs Act, and the proper exercise of such discretion in directing the deposit of duty and penalty pending appeal. Jurisdiction of Customs Authorities: The petitioner, an exporter of marine products, imported raw materials without paying duty under the Duty Exemption Entitlement Scheme. Customs Authorities alleged violation of license conditions, leading to a demand for duty and penalty. The petitioner objected, citing lack of jurisdiction for Customs Authorities to take action. A judgment from the High Court of Madras supported the petitioner's stance. Discretion under Section 129E: The petitioner appealed the Customs Authorities' decision to the Tribunal, seeking dispensation from depositing the demanded duty and penalty. The Tribunal, in its order, did not give weight to the Madras High Court judgment supporting the petitioner. It directed the petitioner to deposit a sum within a specified time, considering the financial position of the petitioner. Proper Exercise of Discretion: The High Court found that the Tribunal did not adequately consider relevant factors in exercising its discretion under Section 129E. The Court emphasized the importance of prima facie case on merits, financial circumstances of the appellant, and the mandate of Article 265 of the Constitution regarding tax collection. The Court cited previous decisions to support the relevance of a prima facie case in such matters. Judgment and Direction: The High Court quashed the Tribunal's order for not being in accordance with the law and failing to pass proper judgment. The Court directed the Tribunal to restore the appeal, dispose of it on merits without insisting on further deposit, and emphasized expeditious handling of the case. The original petition was allowed with no costs imposed.
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