RESTORATION OF APPEAL

[Mr. M. GOVINDARAJAN]

The indirect tax laws provide for filing appeal against the order of the Adjudicating Authority before the Commissioner (Appeals).  Likewise any person aggrieved by the order of Commissioner (Appeals) may file appeal before the Appellate tribunal.   The provisions of indirect laws require to pre deposit the duty/tax demanded, interest and penalty, if any imposed before filing appeal with the Adjudicating Authority.   However appellants may file an application for waiver of pre deposit of duty/tax demanded, interest and penalty, if any imposed for hearing the appeal.   The Commissioner (Appeals)/Appellate Tribunal after analyzing the circumstances of the case may allow waiver of pre deposit or may partly waive and to pay the balance amount or may direct to pay the entire amount. 

     The appeal may be dismissed in case the pre-deposit order by the Commissioner (Appeals)/Appellate tribunal is not complied with.   In such cases the appeal could not be restored unless otherwise the pre-deposit order is complied with.  The dismissal order for non compliance with the pre-deposit is not the final order.   The Supreme Court in 'Collector, Land Acquisition, Anantang V. M.S. Katijui' - 1987 (28) ELT 185 SC held that it is not possible to regard the order of dismissal on the ground that penalty amount was not deposited in time to be a final order.   Some arguments may arise if the appeal is restored after compliance with the pre-deposit in the later stage after dismissal of the appeal will amount to review the earlier order.  The Supreme Court in the above said case observed that it is not possible to accept the view that restoring such an appeal would amount to reviewing to earlier order of dismissal.

     In this article five cases laws are given in which the restoration of appeal is disposed filed by the assessees as well as by the Department.

     In 'Isha Chemicals & Micronutrients Private Limited V. Commissioner of Central Excise' - 2008 -TMI - 31831 - HIGH COURT JAMMU & KASHMIR, the High Court perused the order of the Deputy Commissioner of Central Excise.  The order indicates that the petitioner company had been afforded sufficient opportunities to oppose the imposition of penalty and duty on the seized excisable items.   The Company and its representatives had however avoided participation in the proceedings on one pretext or the other.   The Deputy Commissioner of Central Excise, had thus, on the basis of facts, appearing from the records found the petitioner company responsible for evading central excise duty in clandestinely clearing 'zinc metal' from its premises to those from whose premises it had been later recovered and seized.  The conduct of the petitioner company and its Managing Director does not appear to be that bona fide litigant who may be interested in seeking adjudication of its claim before the statutory forums.  They resolve to delay the payment of duty and penalties besides avoiding to compliance of the statutory provisions requiring deposit of the penalties and duty before seeking consideration of the appeals which had been preferred by the Company before the forums prescribed.   The High Court held that the tribunal and the Commissioner has passed the impugned order in the Writ Petition on being satisfied that the statutory provisions regulating the filing of appeals under the Central Excise Act had not been complied with by the appellants and its Managing Director ands a consequence thereof, the appeals were not required to be considered.   There is no case in favor of the petitioner company to restore fresh adjudication of its appeal before the authority merely on the ground that the duty and penalties stood paid after a period of four years, because payment of duties and penalties would not create any additional right in the petitioner company to seek re-adjudication of its appeal which had since failed because of non compliance of the statutory provisions regulating the filing and consideration of the appeals.

     In 'Commissioner of Central Excise, Belapur V. Coromandel Fertilizers Ltd.,' - 2008 (12) STR 781 (Tri. Mumbai), the appeal filed by the Revenue was dismissed as non maintainable due to the reason that the authorization was invalid.   It is the submission of the Revenue that along with this application for restoration of appeal the Revenue has filed fresh valid authorization.   The Revenue relied on the judgment in the case 'Commissioner of Central Excise V. Maikkal Fibres Ltd.,' - 2007(6) STR 277 (Tri. Del) the tribunal held that the revenue having filed fresh authorization and if there is any delay in filing such authorization is condonable.   The respondent argued that the subsequent authorization after the dismissal of the appeal has no value.   The respondent relied on the decision of the tribunal in 'Commissioner of Central Excise V. John Choudhury' - 2006 (201) ELT 308 held that the authorization was not proper and legal at the time of filing the appeal.   Any subsequent authorization after the appeal has been dismissed has no value.   The tribunal, on the basis of the above decision, held that the application for restoration of appeal filed by the Revenue is devoid of merits and to same is dismissed.

     In 'BSNL V. Commissioner of Central Excise, Jaipur - II' - 2008 -TMI - 31203 - CESTAT NEW DELHI the applicant filed this application for restoration of the appeal.  The appeal filed by the applicant was dismissed vide order dated 03.08.2007 for want of clearance from Committee on Disputes.   Now the applicant produced the necessary clearance from Committee on Disputes to pursue the appeal.   The delay of 80 days in filing the application is also well explained.  In these circumstances the final order dismissing the appeal is recalled the appeal is restored to its original number.

     In 'Scan Computers Consultancy V. Union of India' -2008 (12) STR 108 (Guj-HC), the High Court held that the Commissioner (Appeals) committed an error in law when he came to the conclusion that he could not restore the appeal and the only remedy was by way of appeal before higher forum.   Needless to state that, by mere default in making deposit as directed, the appellant does not stand to gain anything and only delays his right to have his case adjudicated. Nor does such a delay in making pre deposit cause any prejudice to the Revenue in the absence of any operation in favor of the petitioner.   In the circumstances the Commissioner (Appeals) is directed to hear and decide the afresh the Misc. application for restoration of appeal in accordance with law after giving reasonable opportunity of being heard to the petitioner.

     In 'Gangadhar Pharma V. Commissioner of Central Excise, Bhopal' - 2008 (12) STR 283 (Tri. Del) the applicant filed this application for restoring the appeal dismissed by order dated 25.2.2008 for non compliance of the stay order.   The appellants contended that they moved the writ petition before the High Court, Madhya Pradesh.  By order dated 05.03.2008 the High Court directed the applicant to deposit a sum of Rs. 2 lakhs within a period of one month from the date and the tribunal shall not dismiss the appeal filed by the appellants on the grounds of non deposit of amount in question.   On perusal of the record the tribunal found that the tribunal dismissed the order dated 25.02.2008 prior to the passing of the order of the High Court.   The tribunal found no merit in the application filed by the applicant.   The tribunal dismissed the application.