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2018 (12) TMI 1369 - HC - CustomsMaintainability of appeal - non-compliance with the pre-deposit - section 129(E) of the Customs Act 1962 - Held that - The Delhi High Court has relaxed the condition of pre-deposit - The Court has referred to a decision in Pioneer Corporation vs. Union of India 2016 (6) TMI 437 - DELHI HIGH COURT wherein a Division Bench of this Court has held that the High Court while exercising writ jurisdiction under Article 226 of the Constitution can exercise discretion and reduce the pre-deposit in rare and deserving cases notwithstanding the amendment made under Section 35F of the Customs Act. The statute has not withdrawn or taken away the said power vested in the writ court which should be exercised in rare but compelling and deserving cases when the cause of justice requires such reduction. Here is a case where there is a dispute in respect of classification of the total value of the goods. The total value of the goods is stated to be only 13 lakhs whereas the claimed amount is 24 crores and therefore it is a fit case where the classification has to be decided by the appellate court - ends of justice would be met if a direction is given to the petitioner to deposit a sum of 15, 00, 000/- and thereafter the appellate authority shall entertain the appeal - petition allowed.
Issues:
Challenge to rejection of claim for setting aside an original order and restoring Customs Classification due to non-payment of predeposit under Section 129(E) of the Customs Act, 1962. Analysis: 1. The writ petition challenged the rejection of the claim by the 2nd respondent, who refused to entertain the appeal due to non-payment of predeposit under Section 129(E) of the Customs Act, 1962. The petitioner sought to set aside the original order and restore the declared Customs Classification. The 2nd respondent emphasized the necessity of predeposit under Section 128, which mandates a deposit of 7½ of duty in cases where duty or duty and penalty are disputed. 2. The respondents contended that the imported goods fell under a specific heading, attracting a duty of &8377; 22 crores as per the impugned orders. They argued that granting any concession on pre-deposit would lead to revenue loss for the Government. The respondents urged for the dismissal of the writ petition to uphold the revenue implications. 3. The record revealed a dispute in the classification of the goods, which were pending clearance with the Customs House. Despite valid reasons presented by the petitioner for not making the predeposit and citing a previous High Court order allowing pre-deposit relaxation, the 3rd respondent rejected the claim for non-payment of predeposit under Section 129(E) of the Customs Act, 1962. The petitioner, aggrieved by this decision, filed the present writ petition. 4. The petitioner relied on a judgment by the Delhi High Court in a similar case, where the condition of pre-deposit was relaxed. Referring to the decision in Pioneer Corporation vs. Union of India, the High Court highlighted the discretion of the writ court to reduce pre-deposit in rare and deserving cases, emphasizing the importance of justice in such decisions. 5. Considering the value of the goods in dispute and the necessity to decide the classification issue, the High Court directed the petitioner to deposit a sum of &8377; 15,00,000 before the 2nd respondent. The Court set aside the order of the 2nd respondent and instructed them to entertain the appeal and make a decision within eight weeks from the date of the order. In conclusion, the High Court allowed the writ petition, emphasizing the importance of justice and the discretion of the court to reduce pre-deposit in deserving cases. The decision aimed to resolve the classification dispute effectively while ensuring compliance with the Customs Act provisions regarding predeposit.
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