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TMI Blog2012 (9) TMI 242X X X X Extracts X X X X X X X X Extracts X X X X ..... t no opportunity of hearing was provided to the appellant with regard to undue hardship on the application moved under Section 35F of the Act. Accordingly the decision with regard to rejection of application by the appellate authority as adjudicating authority was violation of principles of natural justice. 5. It shall be appropriate to discuss the brief facts of the case on record as noted by the Customs, Excise & Service Tax Appellate Tribunal, New Delhi in short 'Tribunal'. 6. M/s. ACME Global, 40B, Sarojini Nagar, Lucknow (hereinafter referred to as the 'appellant') are engaged in manufacturing of 'Ada' Brand 'Pan Masala' contained tobacco commonly known as gutka classifiable under Chapter sub-heading 2403 99 90 of the first schedule to the Central Excise Tariff Act, 1985 and as they were found to have failed to comply with the requirement of provisions of excise law, a show cause notice dated 13-7-2009 came to be issued which was contested by the appellant by filing their reply dated 25-1-2010. The adjudicating authority, after hearing the party, confirmed the demand of the tune of Rs. 6,08,875/- alongwith interest and equal amount of penalty under its order dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the Appellate Tribunal is of opinion that the deposit of duty demanded or penalty levied would cause undue hardship to such person, the Commissioner (Appeals) or, as the case may be, the Appellate Tribunal, may dispense such deposit subject to such conditions as he or it may deem fit and impose so as to safeguard the interests of revenue : Provided further that where an application is filed before the Commissioner (Appeals) for dispensing with the deposit of duty demanded or penalty levied under the first proviso, the Commissioner (Appeals) shall, where it is possible to do so, decide such application within thirty days from the date of filing." 9. A plain reading of Section 35F shows that by preferring the appeal against the order passed by original authority, it shall be incumbent on the assessee to deposit the tax demand raised. However, under proviso liberty has been given to the appellate authority to pass appropriate order to reduce the deposits. The provision contained under Section 35F of the Act does not provide that before passing order under this provision, opportunity of hearing should be given. 10. Learned counsel for the respondent, Sri Rajesh Singh Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch authority to decide the appeal or the application only after affording a personal hearing. But any order passed after taking into consideration the points raised in the appeal or the application shall not be held to be invalid merely on the ground that no personal hearing had been afforded. This is all the more important in the context of taxation and revenue matters. When an authority has determined a tax liability or has imposed a penalty, then the requirement that before the appeal is heard such tax or penalty should he deposited cannot be held to be unreasonable as already pointed out above. In the case of Shyam Kishore v. Municipal Corpn. of Delhi it has been held by this Court that such requirement cannot be held to be harsh or violation of Article 14 of the Constitution so as to declare the requirement of pre-deposit itself as unconstitutional. In this background, it can be said that normal rule is that before filing the appeal or before the appeal is heard, the person concerned should deposit the amount which he has been directed to deposit as a tax or penalty. The non-deposit of such amount itself is an exception which has been incorporated in different statutes includi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w. The judgment and order passed by Hon'ble Supreme Court is binding under Article 141 of the Constitution of India. The judgment of Supreme Court in the case of A.K. Kraipak v. Union of India and Menaka Gandhi v. Union of India (supra) though deals with the principles of natural justice, the hands of the Court are tight when Hon'ble Supreme Court itself interprets statutory provision and gives different meaning. 12. Learned counsel for the appellant has further relied upon the case reported in (2006) 13 SCC 347 = 2006 (204) E.L.T. 513 (S.C.) = 2008 (12) S.T.R. 104 (S.C.), Benara Valves Ltd. and Others v. Commissioner of Central Excise and Another. In case of Benara, their Lordship of Supreme Court has held that while deciding the issue with regard to undue hardship appellate authority has to apply its mind and pass reasoned order, there should not be a mechanical application of mind. The provision contained in case of Benara Valves (supra) does not seem to be applicable under the facts and circumstances of the present case, that too when the petitioner has not raised grievance against the original order passed under Section 35G of the Act at initial stage. Only at later stag ..... X X X X Extracts X X X X X X X X Extracts X X X X
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