2014 (11) TMI 383 - HC - Customs

Waiver of pre deposit - Benefit of interim stay - Whether any substantial question of law is involved in the present case so as to relegate the petitioner to avail the statutory remedy by way of appeal - Held that - In the appellate order it is stated that the petitioner had to produce a certificate with reference to the notifications, but the same was not produced at the time of clearance of the goods before the Customs authorities, which was a mandatory requirement so as to avail the benefit of exemption, if at all any exemption was to be provided. These aspects are largely with regard to the factual position and as such, it prima facie cannot involve any substantial question of law, so as to enable the petitioner to avail and maintain the remedy by way of appeal. That apart, the relief sought for by the petitioner vide relief No.(ii) to direct the appellate authority to consider and finalise the appeal on time, cannot be the subject matter of any appeal, as it can be dealt with only by issuance of a writ of mandamus. petitioner is entitled to claim set off, in respect of the payment already effected, pursuant to judgment to an extent of 25%. It is made clear that the petitioner is required to satisfy only the balance 25%, as ordered by the Tribunal - Decided partly in favour of assessee.

Summary

Issues:
Interim order by Customs, Excise & Service Tax Appellate Tribunal, entitlement to exemption from Customs duty, satisfaction of export obligation, challenge to appellate orders, maintainability of appeal against interim orders, substantial question of law, financial position of petitioner, duty payable, set off claim.

Interim Order by Customs Tribunal:
The petitioner challenged an interim order by the Customs, Excise & Service Tax Appellate Tribunal, Bangalore, requiring 50% of duty payable to be satisfied for interim stay during appeal. The petitioner, a 'World Bank Aided Project,' imported plant and machinery with exemption from Customs duty but failed to meet export obligations, leading to a demand for payment. Various appellate orders modified the liability percentage to be satisfied for stay benefits.

Maintainability of Appeal Against Interim Orders:
The respondent argued that appeal against interim orders should be under Section 35G of the Central Excise Act, not a writ petition. Citing precedents, the respondent contended that challenges against interim orders are maintainable. The petitioner differentiated the provisions of FEMA, Customs Act, and Central Excise Act, emphasizing that an appeal under the Customs Act requires a 'substantial question of law,' which the current condition did not involve.

Substantial Question of Law and Financial Position:
The court analyzed precedents and clarified that the presence of a substantial question of law varies case by case. The petitioner stressed eligibility for exemption and financial status from submitted documents. However, the court noted that factual aspects like producing mandatory certificates for exemption did not raise substantial legal questions. The relief sought for timely appeal finalization was deemed not appealable but through a writ of mandamus.

Duty Payable and Set Off Claim:
The court clarified that the duty payable referred to the amount fixed by the assessing authority, not the outstanding balance. Considering previous judgments, the court upheld the Tribunal's order to satisfy the balance 25% after accounting for the 25% already paid as per a prior judgment. The petitioner was granted one month to fulfill the condition.

This detailed analysis of the judgment covers the issues involved comprehensively, addressing the legal nuances and arguments presented by both parties in the case.