2022 (8) TMI 1006 - AT - Customs

Maintainability of appeal - requirement of mandatory pre-deposit contemplated under Section 129E of the Customs Act, 1962, not complied with - HELD THAT - It would be seen from a bare perusal of section 129E of the Customs Act that after 6.8.2014 neither the Tribunal nor the Commissioner (Appeals) have the power to waive the requirement of pre-deposit, unlike the situation which existed prior to the amendment made in section 129E on 06.08.204 when the Tribunal, if it was of the opinion that the deposit of duty and interest demanded or penalty levied would cause undue hardship, could dispense the said deposit on such conditions as it deemed fit to impose so as to safeguard the interest of the Revenue. The Supreme Court in Narayan Chandra Ghosh vs. UCO Bank and Others 2011 (3) TMI 1478 - SUPREME COURT , examined the provisions contained in section 18 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 relating to pre deposit in order to avail the remedy of appeal. The provisions are similar to the provisions of section 129E of the Customs Act - The Supreme Court emphasised that when a Statue confers a right to appeal, conditions can be imposed for exercising of such a right and unless the condition precedent for filing appeal is fulfilled, the appeal cannot be entertained. The Supreme Court, therefore, held that deposit under the second proviso to section 18(1) of the Act, being a condition precedent for preferring an appeal, the Appellate Tribunal erred in law in entertaining the appeal. A Division Bench of Delhi High Court in M/s Vish Wind Infrastructure LLP v/s Additional Director General (Adjudication), New Delhi 2019 (8) TMI 1809 - DELHI HIGH COURT examined the provisions of section 35F of the Central Excise Act, 1944 which are pari materia to section 129E of the Customs Act and held that every appeal filed before the Tribunal after the amendment made in section 35F of the Excise Act and section 129E of the Customs Act on 06.08.2014 would be maintainable only if the mandatory pre-deposit was made. Thus, it is not possible to maintain the appeal without making the required pre-deposit - appeal dismissed.

Summary

Issues Involved:
1. Non-compliance with the mandatory pre-deposit requirement under Section 129E of the Customs Act, 1962.
2. Examination of the Tribunal's power to waive the pre-deposit requirement.
3. Analysis of relevant judicial precedents regarding pre-deposit requirements.

Issue-wise Detailed Analysis:

1. Non-compliance with the mandatory pre-deposit requirement under Section 129E of the Customs Act, 1962:
The appellant filed an appeal on March 02, 2020, without making the mandatory pre-deposit as required under Section 129E of the Customs Act, 1962. A defect notice was issued on March 14, 2022, instructing the appellant to rectify the defect by April 18, 2022. Despite reminders and notices, the appellant failed to comply with the pre-deposit requirement or appear before the Tribunal. Consequently, the appeal was taken up on multiple dates, and the appellant was granted additional opportunities to comply, but no action was taken.

2. Examination of the Tribunal's power to waive the pre-deposit requirement:
Section 129E of the Customs Act, as amended on August 06, 2014, explicitly states that neither the Tribunal nor the Commissioner (Appeals) has the authority to waive the pre-deposit requirement. The provision mandates that a certain percentage of the duty or penalty must be deposited before an appeal can be entertained. This amendment removed the discretionary power previously available to the Tribunal to waive the deposit in cases of undue hardship.

3. Analysis of relevant judicial precedents regarding pre-deposit requirements:
The judgment references several key decisions to support the strict interpretation of Section 129E:
- Narayan Chandra Ghosh vs. UCO Bank and Others: The Supreme Court held that statutory conditions for filing an appeal, such as pre-deposit requirements, must be fulfilled, and the Tribunal cannot waive these conditions.
- Chandra Sekhar Jha vs. Union of India: The Supreme Court reiterated that the amended Section 129E does not allow for discretionary waiver of the pre-deposit requirement.
- Dish TV India Limited vs. Union of India: The Delhi High Court emphasized that courts cannot waive the statutory pre-deposit requirement, which has already been significantly reduced by the legislature.
- M/s Vish Wind Infrastructure LLP vs. Additional Director General (Adjudication): The Delhi High Court held that appeals filed after the amendment must comply with the mandatory pre-deposit requirement.
- Diamond Entertainment Techno. P. Ltd. vs. Commissioner of CGST: The Delhi High Court maintained that the Tribunal cannot entertain appeals without the mandatory pre-deposit.
- Ankit Mehta vs. Commissioner, CGST Indore: The Madhya Pradesh High Court dismissed a writ petition challenging the pre-deposit requirement, reaffirming the mandatory nature of Section 129E.

Conclusion:
Based on the statutory provisions and judicial precedents, the Tribunal concluded that the appeal could not be maintained without the mandatory pre-deposit. The appeal was dismissed solely on the ground of non-compliance with Section 129E of the Customs Act, 1962.