1994 (7) TMI 160 - AT - Customs

Summary

Issues Involved:
1. Modification of earlier Stay Order.
2. Financial hardship of the appellant.
3. Compliance with Section 129E of the Customs Act, 1962.
4. Request for out-of-turn hearing.

Detailed Analysis:

1. Modification of Earlier Stay Order:
The appellant sought modification of the earlier Stay Order No. 35/94-WRB, dated 11-1-1994. The appellant's counsel argued that the appellant is experiencing severe financial hardship and is unable to secure a bank guarantee. Consequently, the appellant requested that the pre-deposit requirement be waived and the appeal be heard on merits at an early date.

The respondent's representative opposed the modification, stating that the earlier stay order had already considered the appellant's financial hardship. However, he did not object to an extension of time for compliance with the stay order.

2. Financial Hardship of the Appellant:
The appellant claimed significant financial hardship, citing ongoing lawsuits by various banks and an inability to obtain bank guarantees. Despite these claims, the Tribunal found no new evidence or changed circumstances from the last hearing. The Tribunal referenced previous cases, such as Macneill and Magor Ltd. v. Collector of Customs and Maharashtra Tubes Ltd. v. Collector of Customs, to emphasize the importance of financial documentation and liquidity in determining undue hardship.

The Tribunal noted that the appellant had not provided up-to-date balance sheets, and there was no evidence that the sale proceeds of imported materials had been credited to the appellant's account books. Consequently, the Tribunal concluded that the appellant's liquidity position could not be deemed poor based on the available evidence.

3. Compliance with Section 129E of the Customs Act, 1962:
The Tribunal highlighted the legal requirement under Section 129E of the Customs Act, 1962, which mandates the deposit of duty demanded or penalty levied pending an appeal. The Tribunal cited several precedents, including the Supreme Court's decisions in Navin Chandra Chhotelal v. Central Board of Excise and Customs and Vijay Prakash D. Mehta v. Collector of Customs, to underscore the conditional nature of the right to appeal and the necessity of compliance with Section 129E.

Given the appellant's failure to demonstrate undue hardship convincingly and the absence of compliance with the pre-deposit requirement, the Tribunal found no justification for modifying the stay order.

4. Request for Out-of-Turn Hearing:
The appellant's counsel requested an out-of-turn hearing, which the Tribunal stated could only be granted after complying with Section 129E of the Customs Act, 1962. The Tribunal reiterated that the right to appeal is conditional and subject to statutory requirements. Therefore, the appellant must first comply with the terms of the stay order before seeking an expedited hearing.

Conclusion:
The Tribunal granted the appellant a two-month extension to comply with the terms of the stay order dated 11-1-1994. The appellant was instructed to report compliance within two and a half months, with the matter scheduled for mention on 3rd October 1994. The Tribunal warned that failure to comply would result in the dismissal of the appeal for non-compliance with Section 129E of the Customs Act, 1962.