2022 (10) TMI 147 - AT - Customs

Pre-deposit - adjustment of amount deposited by another person / entity with the requirement of pre-deposit by the appellant - section 129E of the Customs Act - HELD THAT - It is evident from section 129E that the legal requirement is that the appellant has to make the mandatory pre-deposit failing which the appeal cannot be admitted at all by this Tribunal. Of course, if during the course of investigation or at any time before filing the appeal, the appellant had deposited any amounts, such amounts would qualify as pre-deposit for the reason that of the total amount of duty confirmed or penalty imposed on the appellant in the impugned order, if some amount has already been deposited only the rest has to be paid. Usually, the impugned order itself appropriates the amounts already deposited towards the liability of duty or penalty. The amounts deposited by the other entities cannot be reckoned towards the pre-deposit by the appellant herein. Such amounts can be reckoned towards pre-deposit in appeals, if any, by such entities and if they had not filed any appeals, towards their liabilities of duty or penalty as per the order of the lower authority. Of course, if there is no liability against any entity as per the order of the lower authority but any amount has been paid by such entity or if the entity paid an amount in excess of the liability as per the order, such entity can seek refund of the amounts so deposited. The applications filed by the appellant deserves to be rejected and are rejected - List on October 06, 2022.

Summary

Issues:
1. Consideration of amounts deposited by entities as payment of mandatory pre-deposit under section 129E of the Customs Act in the appeal.

Analysis:
The miscellaneous applications were filed by an appellant requesting the consideration of amounts deposited by certain entities during the investigation as payment of mandatory pre-deposit under section 129E of the Customs Act in the appeal. The appellant submitted copies of No Objection certificates from the entities that made the pre-deposit. The amounts, dates, and details of the deposits were presented, showing deposits made by various entities through different banks. The appellant's counsel argued that the deposits were made under coercion during the investigation and were actually drawn from the bank account of the appellant.

The revenue opposed the adjustment of these deposits, stating that Section 129E requires the appellant to make the pre-deposit, and without such deposit, the appeal cannot be maintained. The authorized representative for the revenue contended that there is no legal provision allowing amounts paid by other entities to be considered as pre-deposit by the appellant, even with the submission of no objection certificates from those entities.

Upon considering the submissions from both sides, the Tribunal examined Section 129E of the Customs Act, which mandates the deposit of duty, interest, or penalty demanded pending an appeal. The Tribunal noted that the legal requirement is for the appellant to make the mandatory pre-deposit for the appeal to be admitted. Any amounts already deposited by the appellant before filing the appeal can be considered as pre-deposit, with the remaining balance to be paid. However, the Tribunal clarified that amounts deposited by other entities cannot be counted as pre-deposit by the appellant. Such amounts can only be considered for pre-deposit in appeals filed by those entities or towards their liabilities as per the lower authority's order.

In light of the explicit legal provision, the Tribunal rejected the applications filed by the appellant, emphasizing that the appellant must make the pre-deposit within four weeks as a final opportunity. The case was listed for further proceedings on a specified date.