2014 (8) TMI 611 - HC - Central Excise

Jurisdiction of Commissioner - Power to review - Whether the Commissioner (Appeals) has the power to review his own order of pre-deposit - Held that - such a power is available to the Tribunal under Section 35-C (2) of the Act to rectify any mistake apparent on the record. Therefore, we find that the Tribunal was justified in rejecting the plea of the appellant that the Commissioner (Appeals) ought to have reviewed the order. When there is no power under the statute, the Commissioner (Appeals) has no authority to entertain the application for review of the order. Tribunal has clearly held that in an appeal against the final order of the Appellate Commissioner (dismissing the appeal for failure to pre-deposit), the Tribunal will not adjudicate upon the merits of the appeal, but if the order of pre-deposit passed by the Commissioner (Appeals) in the given facts and circumstances of the case is erroneous, the Tribunal is required to set aside the order of the Appellate Authority and remand the matter to the Appellate Commissioner for de novo consideration after passing an appropriate order as to pre-deposit. We find that this exercise has not been done by the Tribunal in the present case and it has summarily upheld that the rejection of the appeal for failure or pre-deposit is impeccable and, therefore, we have no hesitation to hold that the Tribunal should have considered the pre-deposit issue perforce and to that extent the order has been rightly put to test by the appellant before this Court - Matter remitted back - Decided in favour of assessee.

Summary

Issues Involved:
1. Whether the Tribunal was right in dismissing the appeal filed by the assessee holding that the Commissioner (Appeals) has no power to review the order of pre-deposit.
2. Whether the Tribunal was justified in dismissing the appeal filed holding that the Appellate Commissioner's order dismissing the appeal for non-compliance of the order in terms of Section 35-F without considering the merits of the assessee's case on the issue of pre-deposit is right.

Issue 1: Review of Order of Pre-deposit by Commissioner (Appeals)
The appellant appealed against the order of the Appellate Commissioner dismissing the appeal for non-compliance with the pre-deposit order. The Tribunal upheld the dismissal, stating that the Commissioner (Appeals) lacked the power to review the order of pre-deposit. The High Court concurred, citing the absence of statutory provision granting such power to the Commissioner (Appeals). The Court emphasized that only the Tribunal had the authority to rectify any apparent mistake on the record under Section 35-C (2) of the Act. Consequently, the first substantial question of law was answered against the assessee.

Issue 2: Dismissal of Appeal for Non-Compliance
The Tribunal dismissed the appeal without considering the merits of the case due to non-compliance with the pre-deposit order. The appellant contended that the Tribunal should have analyzed the prima facie case, balance of convenience, and financial hardship before dismissal. Referring to precedents, the Court highlighted the importance of considering applications for waiver of pre-deposit meticulously. The Court noted that the Tribunal should not adjudicate on the merits of the appeal when dismissing it for non-compliance. Instead, if the pre-deposit order by the Commissioner (Appeals) was erroneous, the matter should be remitted for reevaluation. The Court found that the Tribunal failed to conduct this assessment and remanded the case back to the Appellate Tribunal for reconsideration of the pre-deposit issue. Consequently, the second substantial question of law was answered in favor of the assessee, and the appeal was allowed with no order as to costs.

This comprehensive analysis of the judgment addresses the issues raised in the appeal, providing a detailed overview of the legal reasoning and decisions made by the courts involved.