2019 (3) TMI 1533 - HC - Customs

Compliance with the mandatory pre-deposit - demand of penalty during the pendency of the appeal - Section 129-E of the Customs Act, 1962 - Held that - A simple reading of the section shows that the deposit of seven and a half per cent appears to a condition which has to be complied with for filing the appeal - Learned counsel for the petitioner fails to satisfy us that the appellate authority has a power to relax that condition. Concededly, the petitioner has not filed the appeal complying with the said provision. The writ petition disposed off leaving it open to the petitioner to move an appropriate application before the first respondent.

Summary

Issues:
- Writ petition under Article 226 for relief against coercive action pursuant to Recovery Orders
- Demand of penalty during pendency of appeal
- Requirement of compulsory deposit under Section 129-E of the Customs Act, 1962

Analysis:
The judgment by the Allahabad High Court pertains to a writ petition filed under Article 226 of the Constitution of India seeking relief against coercive action pursuant to Recovery Orders dated 08.02.2018 and 13.04.2018. The petitioner requested a writ, order, or direction in the nature of Mandamus to restrain or prohibit the respondents from taking coercive action during the pendency of an appeal titled "Sanjay Kashyap Vs CC Ghaziabad." Additionally, the petitioner sought a direction for the authorities not to demand the impugned penalty during the appeal process.

The court considered the provisions of Section 129-E of the Customs Act, 1962, which mandates the deposit of a certain percentage of duty demanded or penalty imposed before filing an appeal. The section specifies the percentages required to be deposited based on the nature of the dispute. The court noted that the deposit of seven and a half per cent is a condition for filing an appeal and observed that the petitioner had not complied with this provision. The court further highlighted that the appellate authority may not have the power to relax this condition.

During the hearing, the petitioner's counsel requested permission to submit an application before the appellate authority to rectify the non-compliance with the deposit requirement. Consequently, the court disposed of the writ petition, allowing the petitioner to move an appropriate application before the first respondent. Importantly, the court clarified that it did not express any opinion on the merits of the case, emphasizing that the first respondent should independently decide on the matter in accordance with the law.

In conclusion, the judgment underscores the importance of complying with statutory requirements, particularly regarding the deposit of a percentage of duty or penalty before filing an appeal under the Customs Act, 1962. It highlights the need for petitioners to adhere to such conditions and seek appropriate remedies through the prescribed legal procedures.