2014 (5) TMI 247 - HC - Central Excise

Writ petition against the order of the tribunal dismissing the appeal of the assessee for non-deposit of amount as per ex-parte stay order - alternative remedy - Held that - Where the alternative remedy is not definite, but subject to the satisfaction of the High Court of involvement of a substantial question of law, a writ application should, in my view, not be rejected on the sole ground of existence of an alternative remedy of appeal. Moreover, it is doubtful whether any substantial question of law is involved in the instant case. The impugned order cannot be sustained in law and the same is set aside and quashed. The writ application is, accordingly allowed. The learned Tribunal shall consider the Miscellaneous Application afresh in the light of the observation made above without granting unnecessary adjournment but upon compliance with the requisite provisions of law with regard to service of notice of dates of hearing.

Issues:
1. Challenge against an order passed by the Customs, Excise and Service Tax Appellate Tribunal.
2. Recalling and modifying orders related to pre-deposit in connection with an Excise Appeal.
3. Appeal against an Order-in-Original passed by the Commissioner of Central Excise.
4. Non-compliance with deposit directives leading to dismissal of the appeal.
5. Dismissal of the appeal due to alleged lack of notice of hearing date.
6. Compliance with notice requirements under Rule 18 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982.
7. Tribunal's power to recall, vary, or modify an order for pre-deposit under Rule 41.
8. Interpretation of the judgment of the Karnataka High Court regarding the modification of pre-deposit orders.
9. Preliminary objection to the maintainability of the writ application due to the availability of an alternative remedy of appeal.
10. Satisfaction of the High Court on the involvement of a substantial question of law for appeal under Section 35G of the Central Excise Act, 1944.

Analysis:
1. The writ application challenged an order passed by the Customs, Excise and Service Tax Appellate Tribunal concerning the recall and modification of pre-deposit orders in connection with an Excise Appeal. The petitioner sought to challenge the dismissal of the appeal due to non-compliance with the deposit directives and alleged lack of notice of the hearing date.

2. The Tribunal's order dated 17th November, 2011, was dispatched on 22nd November, 2011, and the compliance deadline was set for 9th January, 2012. However, the petitioner claimed to have received the order on 18th January, 2012, which affected the timeline for pre-deposit compliance. Additionally, the petitioner contended that they had no notice of the hearing on 14th February, 2012, further complicating the compliance issue.

3. The Court emphasized the importance of complying with notice requirements under Rule 18 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982. It was noted that statutory rules dictate specific methods of serving notices, and non-compliance with these rules could render orders unsustainable in law.

4. The judgment of the Karnataka High Court was discussed concerning the modification of pre-deposit orders. The Court disagreed with the reasoning of the judgment and highlighted the Tribunal's power under Rule 41 to recall, vary, or modify orders for pre-deposit to secure the ends of justice.

5. A preliminary objection was raised regarding the maintainability of the writ application due to the availability of an alternative remedy of appeal. However, the Court noted that the existence of an alternative remedy should not be the sole basis for rejecting a writ application, especially when the involvement of a substantial question of law is doubtful.

6. Ultimately, the Court set aside and quashed the impugned order, directing the Tribunal to reconsider the Miscellaneous Application while ensuring compliance with notice requirements. The Court clarified that it had not adjudicated the merits of the pre-deposit quantum or the main appeal, leaving those aspects for further consideration.

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