2023 (12) TMI 130 - HC - Customs

Maintainability of appeal - pre-deposit - Appeal rejected on the ground that the petitioner has failed to deposit 7.5% of the amount demanded on account of duty drawback and penalty imposed by the Order-in-Original - HELD THAT - Having perused the record as also the impugned order, in our opinion, the view taken by the Additional Secretary to the Government of India is too technical to say least. The petitioner has urged specific ground in regard to financial difficulty, which ought to have been considered - the issue on merits of such contention has not at all been touched and what has weighed with the authority is that the Revisional and Appellate authority will have to follow the provisions of Section 129-E of the Customs Act, which is in regard to the pre-deposit of 7.5% of the amount demanded. The interest of justice imminently would require that the impugned order passed by the Appellate Authority as confirmed by the Revisional Authority are quashed and set aside and the petitioner be granted an opportunity of its appeal being adjudicated on merits - order passed by the Appellate Authority as confirmed by the impugned order passed by the Revisional Authority is quashed and set aside. The appeal before the Appellate Authority is restored to the file of the Appellate Authority Commissioner of Customs (Appeals), Mumbai Zone-III to be heard on merits. Petition allowed.

Summary

Issues:
The petition under Article 226 of the Constitution of India assailing an order rejecting the petitioner's Revision Application against an order passed by the Appellate Authority. The petitioner was aggrieved by the Order-in-Original passed by the Assistant Commissioner of Customs. The Appellate Authority rejected the appeal due to non-payment of pre-deposit. The petitioner approached the Revisional Authority raising contentions regarding financial difficulties and non-realization of export proceeds. The Revisional Authority rejected the revision application based solely on the non-payment of pre-deposit.

Details of the Judgment:

1. The Order-in-Original confirmed the demand of Drawback amount and imposed a penalty on the exporter for non-submission of Negative Statements within the prescribed time limit under the Customs Act, 1962.

2. The Appellate Authority rejected the appeal citing the provisions of Section 129E of the Customs Act, 1962, which mandates a pre-deposit of 7.5% of the amount demanded on account of duty drawback and penalty. The appeal was deemed not maintainable due to the failure to make the pre-deposit.

3. The petitioner raised contentions before the Revisional Authority regarding financial difficulties, non-realization of export proceeds, and the imposition of pre-deposit. However, the Revisional Authority rejected the revision application solely based on the non-payment of pre-deposit without considering the grounds raised by the petitioner.

4. The High Court, after hearing arguments from both parties, found the view taken by the Revisional Authority to be overly technical. The Court noted that specific grounds related to financial difficulties were not considered. The Court held that the impugned orders should be quashed, and the petitioner should be granted an opportunity to have their appeal adjudicated on merits.

5. The Court allowed the petition, quashed the orders passed by the Appellate Authority and Revisional Authority, and restored the appeal to the Appellate Authority for a hearing on merits. The deposit made by the petitioner was considered valid for the appeal, and the Appellate Authority was directed to decide the appeal expeditiously within four months.