1991 (4) TMI 126 - HC - Central Excise

Summary

Issues:
1. Dismissal of appeal due to non-payment of pre-deposit amount.
2. Application for restoration of appeal dismissed based on lack of proof of pledging jewels.
3. Interpretation of Section 35F of the Central Excises and Salt Act, 1944 regarding pre-deposit requirements.

Analysis:

1. The petitioner was held liable for excise duty by the first respondent and was directed to make a pre-deposit. The second respondent, while acknowledging the petitioner's circumstances, ordered a pre-deposit of Rs. 2,50,000. The petitioner paid Rs. 1,00,000 and filed for modification but the appeal was dismissed on the ground of non-payment. The restoration application was dismissed due to lack of proof of pledging jewels. The High Court observed that the second respondent should have considered the modification application and the genuine attempt made by the petitioner to pay the amount. The Court emphasized the need to show sympathy towards the petitioner's difficulties and directed the appeal to be restored and disposed of without further demands.

2. The respondent argued that the petitioner failed to prove the pledging of jewels as claimed, leading to the dismissal of the restoration application. The Court, however, found this argument irrelevant, emphasizing the genuine attempt made by the petitioner to pay the amount. The Court noted that the closure of the petitioner's unit indicated financial difficulties, and the focus should be on whether the petitioner genuinely faced challenges in making the payment. The Court held that the dismissal of the restoration application based solely on lack of proof of pledging jewels was unjustified, quashing the impugned order and directing the appeal to be restored without additional demands.

3. The Court analyzed Section 35F of the Central Excises and Salt Act, 1944, which mandates the deposit of the entire duty demanded when filing an appeal, with provisions for dispensation in cases of undue hardship. The Court highlighted the need to balance sympathy towards the appellant's circumstances with revenue interests. While acknowledging the second respondent's consideration of the petitioner's hardship, the Court emphasized the importance of genuinely assessing the appellant's financial constraints. The Court concluded that the appeal should proceed without further demands, considering the petitioner's difficulties and the potential impact on revenue.

In conclusion, the High Court quashed the impugned order, directed the restoration and disposal of the appeal without additional demands, and emphasized the importance of considering the genuine financial challenges faced by the appellant in excise duty matters.