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2010 (2) TMI 323 - AT - Central ExciseStay- the failure to comply with the requirements of Section 35F in relation to deposit of the duty as well as non-compliance of the order in terms of the proviso to the said Section 35F, they were required to show cause as to why the appeals should not be dismissed on that count. Held that- that the Tribunal is empowered to dismiss the appeal in case of failure to comply with the requirement of deposit under Section 35F of the Central Excise Act, Section 129E of the Customs Act and Section 87(7) of the Finance Act, 1994 as also to dismiss the appeal for failure to comply with the order passed in exercise of powers under the proviso to the said sections and for that purpose need not wait till the appeal gets ripe for final hearing. Moment it is revealed during the pendency of the appeal that the appellant has either failed to deposit the amount in terms of said provision of law or in compliance with order passed under the said provision of law, the appeal could be dismissed after hearing the appellant on the point as to whether there is any genuine and justifiable ground for non-compliance of the said requirement within the time granted and for that purpose the Tribunal need not wait till the appeal gets ripe for final hearing.
Issues Involved:
1. Non-compliance with Section 35F of the Central Excise Act, 1944. 2. Applicability of Section 35C(2A) of the Central Excise Act. 3. Consequences of non-compliance with Section 35F or orders under its proviso. 4. Interpretation of procedural provisions under Section 35C(2A) and Section 129B(2A). 5. Jurisdiction of the Tribunal to dismiss appeals for non-compliance. Issue-wise Detailed Analysis: 1. Non-compliance with Section 35F of the Central Excise Act, 1944: The appellants failed to comply with the order under Section 35F regarding the deposit of duty. They argued, based on the Calcutta High Court's decision in Promising Exports Limited v. Union of India, that Section 35F is controlled by Section 35C(2A) and thus, appeals should not be dismissed solely for non-compliance with Section 35F. 2. Applicability of Section 35C(2A) of the Central Excise Act: Section 35C(2A) mandates that the Appellate Tribunal decides appeals within three years, with a 180-day limit for appeals with stay orders. The Tribunal clarified that these are procedural provisions and are directory, not mandatory, as supported by the Supreme Court in Sambhaji v. Gangabai. 3. Consequences of Non-compliance with Section 35F or Orders Under its Proviso: The Tribunal referred to several precedents, including Navin Chandra Chhotelal v. Central Board of Excise & Customs and Vijay Prakash D. Mehta v. Collector of Customs, which established that non-compliance with Section 35F or its proviso can justify the dismissal of an appeal. The Tribunal emphasized that the right to appeal is conditional and requires compliance with statutory requirements. 4. Interpretation of Procedural Provisions Under Section 35C(2A) and Section 129B(2A): The Tribunal noted that these sections are procedural and intended to ensure timely disposal of appeals. The Gujarat High Court in Poly Fill Sacks v. Union of India and the Supreme Court in CC&CE, Ahmedabad v. Kumar Cotton Mills Pvt. Limited held that these provisions are directory and not mandatory, allowing for flexibility in case of genuine reasons for delays. 5. Jurisdiction of the Tribunal to Dismiss Appeals for Non-compliance: The Tribunal confirmed its jurisdiction to dismiss appeals for non-compliance with Section 35F or orders under its proviso. It emphasized that such power is inherent and necessary to uphold the statutory requirements. The Tribunal is bound by the Supreme Court's rulings and cannot be overridden by contrary decisions from other authorities. Conclusion: The Tribunal concluded that it is empowered to dismiss appeals for non-compliance with Section 35F or orders under its proviso without waiting for the appeal to be ripe for final hearing. However, before dismissal, the appellant must be given an opportunity to explain any genuine and justifiable reasons for non-compliance. The Tribunal's decision aligns with the established legal precedents and procedural requirements. All appeals were scheduled for a hearing to determine if there were valid reasons for non-compliance.
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