2014 (1) TMI 1341 - HC - Central Excise

Waiver of the predeposit - Confiscation of goods - Imposition of penalty - Whether the impugned oder dated 13.5.2013 passed by the Tribunal is correct in law by directing the appellant to deposit Rs.38,00,000/- when the appellant has a strong prima facie case on merits as well as financial hardship - Held that - Following decision of M/s. L.G. Electronics India Pvt. Ltd. Versus Commissioner of Central Excise, Noida 2009 (6) TMI 29 - ALLAHABAD HIGH COURT - Decided in favour of assessee.

Summary

Issues:
Appeal under Section 35 G of Central Excise Act, 1944 against Tribunal's order confirming excise duty, confiscation, and penalties. Questions of law on deposit amount, expansion, and financial position.

Analysis:
The appellant filed an appeal under Section 35 G of the Central Excise Act, 1944 against the Tribunal's order dated 13th May, 2013, which confirmed excise duty, directed confiscation, and imposed penalties. The Commissioner had ordered the appellant to deposit Rs. 38,00,000/- in Appeal No. 55240 of 2013 and granted waivers of pre-deposit of penalties. The appellant challenged this order, citing strong prima facie case and financial hardship. Three questions of law were framed in the appeal regarding the correctness of the Tribunal's order. The appellant argued that the Tribunal failed to consider the appellant's prima facie case before directing the deposit. Reference was made to a judgment supporting the contention that a prima facie case is necessary for waiver of pre-deposit. The Tribunal's order was set aside, and the appellant was directed to produce a certified copy of the order for further proceedings before the Tribunal to reconsider the waiver applications.

This judgment highlights the importance of considering a prima facie case before directing a deposit in excise duty matters. The Tribunal's failure to assess the appellant's case led to the appeal being allowed. The reliance on a previous judgment supported the appellant's argument regarding the necessity of a prima facie case for waiver of pre-deposit. The decision emphasizes the need for a fair evaluation of the appellant's contentions and financial position before imposing deposit requirements. The setting aside of the Tribunal's order and the direction for a fresh consideration underscore the significance of procedural fairness and legal principles in excise duty cases.