2019 (2) TMI 1029 - HC - Central Excise

Compliance with the pre-deposit - Section 35-F of the Central Excise Act, 1944 - Article 14 and 19(1)(g) of the Constitution of India - petitioner desires to have an adjudication on merits without complying with this condition - Held that - Once the Tribunal found that the condition is not complied with, then, it was not open to it to adjudicate the matter on merits. In the instant case, the writ petition only contains the grounds on merits. We are not concerned with the merits of the appeal. For that to be entertained, there is a condition prescribed by the Statute. That condition was not complied with. Once that condition was not complied with, the appeal was not entertainable. If the petitioner/original appellant complies with the statutory condition of pre-deposit within four months from the date of receipt of a copy of this order and reports compliance to the Tribunal, the Tribunal shall restore the appeal of the petitioner/original appellant for adjudication on merits.

Summary

Issues:
1. Dismissal of appeal by the Customs, Excise and Service Tax Appellate Tribunal without adjudication on merits.
2. Compliance with the statutory condition of pre-deposit under Section 35-F of the Central Excise Act, 1944.
3. Jurisdiction of the Tribunal to dismiss an appeal for non-compliance with pre-deposit condition.
4. Writ jurisdiction to waive or relax statutory pre-deposit condition.

Issue 1: Dismissal of appeal without adjudication on merits
The petitioner argued that the Tribunal's dismissal of the appeal without adjudication on merits was illegal and violated constitutional mandates. The Tribunal's powers include confirming, modifying, or annulling the decision appealed against, but it cannot dismiss the appeal without adjudication on merits solely due to non-compliance with the pre-deposit condition under Section 35-F of the Central Excise Act.

Issue 2: Compliance with pre-deposit condition under Section 35-F
Section 35-F mandates depositing a certain percentage of duty demanded or penalty imposed before filing an appeal. The Tribunal or Commissioner shall not entertain any appeal unless this precondition is satisfied. Non-compliance with the deposit condition renders the appeal non-entertainable, as it is a statutory right conditional upon fulfilling the deposit requirement.

Issue 3: Tribunal's jurisdiction to dismiss for non-compliance with pre-deposit
In the case at hand, the petitioner sought adjudication on merits without complying with the pre-deposit condition. The Tribunal granted time for compliance but dismissed the appeal upon finding non-compliance. The Tribunal's decision not to adjudicate on merits was justified as the statutory precondition for appeal was not met, making the appeal non-entertainable.

Issue 4: Writ jurisdiction to waive pre-deposit condition
The argument that the Court could waive or relax the pre-deposit condition in writ jurisdiction was dismissed. The Court clarified that writ jurisdiction is not intended to grant benefits or enable parties to bypass statutory preconditions for appeal. Upholding the pre-deposit condition does not violate constitutional mandates or render the right of appeal illusory, thus the writ petition was dismissed, subject to compliance with the statutory condition within the specified time frame.