2024 (2) TMI 1277 - SCH - Customs

Validity of Provision mandating a pre-deposit of 7.5% of the penalty - challenge to the constitutional validity of Section 129-E - limitation - HELD THAT - We dispose of these special leave petitions by reserving liberty to the petitioners herein to withdraw the writ petitions filed by them before the High Court. Consequently, the impugned order would pale into insignificance as far as the petitioners herein are concerned. However, liberty is reserved to the petitioners herein to file an appeal u/s 129-E of the Customs Act, 1962 within a period of one month from today. If an appeal is filed within a period of one month from today, the CESTAT shall not raise the issue of limitation, since we have granted liberty to the petitioners to file an appeal. The Special Leave Petitions are disposed of in the aforesaid terms. Pending applications shall stand disposed of.

Summary

Issues involved:
The issues involved in this case are the challenge to the provision mandating a pre-deposit of 7.5% of the penalty amount under Section 129-E of the Customs Act, 1962, and the request for liberty to file an appeal before the Customs Excise and Service Tax Appellate Tribunal (CESTAT) assailing the order or penalty.

Judgment Summary:

Challenge to Provision Mandating Pre-Deposit:
The petitioners in this case were aggrieved by the provision mandating a pre-deposit of 7.5% of the penalty amount under Section 129-E of the Customs Act, 1962. The writ petitions were filed challenging this provision. However, during the proceedings, the petitioners requested to withdraw the writ petitions and sought liberty to file an appeal before CESTAT to challenge the order or penalty on its merits. The respondent objected to this request, citing the delay of nine years since the impugned order was passed. The court noted the petitioners' right to challenge the constitutionality of a law under Article 226 of the Constitution but observed that in this case, the challenge was made without attempting to file an appeal before CESTAT, rendering it in a vacuum. The court disposed of the special leave petitions by allowing the petitioners to withdraw the writ petitions and reserved liberty for them to file an appeal under Section 129-E within one month from the judgment date, with an assurance that CESTAT would not raise the issue of limitation if the appeal is filed within the specified period.

Disposition of Special Leave Petitions:
The Special Leave Petitions were disposed of with the aforementioned terms, granting the petitioners the liberty to withdraw the writ petitions and file an appeal under Section 129-E of the Customs Act, 1962 within one month. Any pending applications were also deemed disposed of by the court.