2024 (6) TMI 313 - HC - Customs

Dismissal of restoration application for appeal u/s 112(a) and (b) of Customs Act, 1962 - complaince with the mandatory pre-deposit or not - Delay in filing appeal - HELD THAT - There are force in the contention of the counsel for the appellant that the Tribunal ought not to have dismissed the appeal of the appellant in limine vide Ext. P3 Order especially since the appellant had reasonably exhibited his bona fides by complying with the mandatory pre-deposit of Rs. 15 lakhs as early as in 2017 itself. Taking note of the fact that the appellant had preferred the appeal as envisaged in Sec. 129 A (1) of the Act and had already remitted the mandatory pre-deposit, the Tribunal ought to have granted the appellant a reasonable opportunity to take appropriate steps for getting the Writ Petition, which was then pending before this Court, disposed of and then to permit him to pursue his remedy in the pending appeal before the Tribunal. Non-suiting him in limine does not appear to be reasonable, especially in the facts and circumstances of the case. The Tribunal in the facts and circumstances of the matter ought to have afforded the appellant an opportunity to challenge the penalty of Rs. 2 crores imposed upon him vide Ext. P1 Order on merits rather than dismissing his appeal in limine on the ground that a Writ Petition on the same subject matter was pending before the High Court. Appeal allowed.

Summary

Issues involved: Appeal against dismissal of restoration application for appeal u/s 112(a) and (b) of Customs Act, 1962 due to delay in filing, challenge of dismissal of Writ Petition, validity of Tribunal's orders.

Appeal against dismissal of restoration application: Appellant filed Writ Petition challenging penalty imposition of Rs. 2 Crores u/s 112(a) and (b) of Customs Act, 1962. Tribunal dismissed appeal due to delay, stating appellant approached High Court on same issue. Restoration application dismissed due to delay, lack of justification. Appellant filed Writ Petition after recovery proceedings initiated. Appellant argued for restoration based on compliance with pre-deposit, steps taken post-dismissal. Tribunal's dismissal questioned for lack of consideration of reasons for delay. Appellant sought direction to restore appeal for consideration on merits.

Challenge of dismissal of Writ Petition: Appellant's counsel contended delay justified, pre-deposit compliance showed bonafides. Criticized Tribunal's dismissal in limine, lack of breathing time. Assailed Tribunal's dismissal of restoration petition for lack of reasoning. Counsel emphasized appellant's actions post-dismissal, urged restoration for merit consideration. Counsel argued Single Judge erred in dismissal, overlooked reasons for delay, pre-deposit compliance. Counsel sought direction to restore appeal for consideration on merits.

Validity of Tribunal's orders: Tribunal dismissed appeal in limine despite pre-deposit compliance, pending Writ Petition. High Court set aside Tribunal's orders, directed restoration of appeal for merit consideration within six months. Emphasized courts should decide on merits, not default. Cited Supreme Court precedents on deciding cases on merits. Tribunal criticized for not affording appellant opportunity to challenge penalty imposition on merits. High Court allowed Writ Appeal, setting aside Single Judge's judgment.

Conclusion: High Court allowed Writ Appeal, setting aside Single Judge's judgment, directing restoration of appeal for merit consideration within six months, criticizing Tribunal's dismissal in limine and lack of opportunity for appellant to challenge penalty imposition on merits.