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TMI Blog2018 (4) TMI 225X X X X Extracts X X X X X X X X Extracts X X X X ..... sed on 10th July, 1992. Recoveries obviously had to be made, especially once the Order in Original had become final. Mere recoveries or even payment after years cannot result in restoration of the appeals or justify condonation of delay in moving the restoration application. The appellant has been grossly negligent and derelict. Their inaction reflects acceptance and abandonment. The appellants have failed to show good cause and justification - there is no flaw or infirmity in the order of the Tribunal, rejecting the application for condonation of delay in filing the restoration application and accordingly dismissing the application for restoration. ROM application dismissed. X X X X Extracts X X X X X X X X Extracts X X X X ..... at accordingly the Appellant has made the pre-deposit in installments till March, 2011. The present appeal by the Appellant raises the following questions of law for consideration: "(i) Whether, the impugned order is passed in violation of the statutory right of the Appellant to contest the appeal as provided under Central Excise Act 1944? (ii) Whether, the dismissal of the restoration application will cause undue hardship to the Appellant inspite of compliance of the condition of pre-deposit as per the direction of Ld. Tribunal? (iii) Whether, delay in meeting the pre-deposit requirement, which is procedural will extinguish the primary substantive right of appeal of the Appellant? (iv) Whether there is any delay for filing application for restoration? (v) Whether the Appellant has a good prima facie case?" 3. That the Appellant (GTC) was engaged in manufacture of cigarettes in Baroda. Earlier the Appellant was getting cigarettes manufactured by its own other factory at Mumbai and from other franchisee units namely M/s Sri Chandra Tobacco Ltd., Hyderabad (SCT), M/s Suvarna Tobacco Ltd., Hyderabad (SFTPL) and Universal Tobacco Ltd, Hyderabad (UTC). The Appellant submits that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... production at all since 1987-88, it approached Andhra Pradesh High Court by way of a Statutory Appeal, praying for a complete waiver of the requirement to pre-deposit the duty, contending, inter alia, that it was not possible for it to pre-deposit 100% of the duty amount within three months. Andhra Pradesh High Court after considering UTC's hardship, directed the Ld. Tribunal vide order dated 04.04.1994, to not dismiss the appeal of UTC for non-compliance of the Section 35F of the Act, subject to UTC depositing half of the amount within four weeks from that day. When UTC's Appeal came up for hearing before the Tribunal, and UTC was unable to pay the amount, the Tribunal again dismissed the appeal on 18.07.1994 for non-compliance of the pre-deposit condition. Thereafter, with regard to SCT, SFTPL and the Appellant, various proceedings took place before this High Court. Ultimately, by orders dated 03.05.1994 and 26.08.1994, this High Court confirmed the order of the Tribunal. Thereafter, when the Appellant approached the Supreme Court against the order of this High Court, it granted an extension to Appellant to pre-deposit up to December, 1994. The Appellant made similar app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Industrial Companies Act, 1985. The Appellant was declared sick in the year 1997 vide Order no. 17/97 passed by BIFR on 03.04.1997. Thereafter, a rehabilitation Sanctioned Scheme-02 was approved by the BIFR vide Order dated 16.12.2002, with cut-off date as 31.12.1998. Paragraph Q of the scheme relates to the dues of the Central Government, i.e. Income tax and Excise. Paragraph Q(f) specifically provided that "To agree for refund/withdrawal of amounts blocked in pre-deposit amounts due to conditions imposed for hearing the appeals and not to impose such conditions of predeposit in future for hearing of appeals against disputed liabilities during the rehabilitation period". The Commissioner Excise preferred an appeal before the AAIFR in the year 2005 challenging the order dated 16.12.2002, however, the same was dismissed vide order dated 18.07.2005 'on the ground of limitation. Thus, the Order of BIFR dated 16.12.2002 attained finality and is binding on the Respondent. In view of the specific provision in SS-02, the Tribunal ought to have admitted the appeal of the Appellant without any imposition of pre-deposit. The net worth of Appellant turned positive during the fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation for extension of the sanctioned scheme on the ground of violation of the scheme by the Income-tax department by issuing the attachment notices and that it could not make the last installment before the Tribunal. The BIFR rejected the claim of the Appellant. Thereafter, the Appellant preferred an appeal before AAIFR, however, the same was also rejected. Thereafter, the Appellant challenged the Order of AAIFR before this Court by way of a Writ Petition, however, the same was withdrawn, and the statement of counsel was recorded that he would file a Modified Draft Rehabilitation Scheme (MDRS) as per majority opinion of AAIFR, before BIFR. Accordingly, the Appellant filed MDRS before BIFR. In the meanwhile, AAIFR dismissed the application of the Income-tax department for attaching the properties of Appellant during the rehabilitation period. The Income-tax department challenged the order of AAIFR before this Court, however, the petition was dismissed. Thereafter, the Department preferred S.L.P. No. 26747 of 2012 (C.A. No. 5038 of 2016), which on 31.08.2012 directed the Department to not alienate the properties of the Appellant. The Supreme Court disposing of C.A. No.5038 of 2016 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he law and facts of the present case. It is also submitted that there is no concept of any extraordinary delay in law, particularly when the facts show the reasonable cause, duly supported by an affidavit. The appellant was under the shelter of BIFR in May, 2016. It is also submitted that the appellant was having a good prima facie case in its favour and the joint liability demand and penalty was imposed without any cogent evidence and in violation of the principles of natural justice. The Court must adopt liberal and justice oriented approach in condoning the delay. The Tribunal failed to consider that the right to prefer an appeal is a statutory right touching the substantive right of the appellant. The Tribunal failed to appreciate that the appellant had already deposited an amount of ₹ 21.26 crore, which exceeds the amount of ₹ 18.83 crore. The impugned order is not only perverse and erroneous but also has failed to take judicial precedents in its true spirit. 7. We have gone through the order of the Tribunal. The Tribunal noticed in the impugned order that there is a delay of more than 22 years, which is extraordinary and the Tribunal has no power to condone such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The appellant having suffered an adverse Order in Original dated 10th July, 1992 deciding the show cause notices dated 25th March, 1988, had filed appeals before the tribunal with applications seeking waiver of pre-deposit. As per the Order in Original, the appellant was liable to pay ₹ 23.22 Crores in all, the break-up being ₹ 12.34 crores, 9.06 crores and ₹ 1.82 crores in respect of transactions or manufacture undertaken by SCT, SFTPL and UTC respectively. Penalty imposed was in addition. Tribunal by order dated 19th August, 1993 had directed the appellant to deposit ₹ 12.0 crores, ₹ 5.0 crores and ₹ 1.82 crores in the three cases(Rs.18.83 crores in all) within three months as a pre-condition and stipulation for hearing the appeals on merits. 11. The appellant had challenged the pre-deposit order before the High Court and the Supreme Court, with alternative prayer for extension of time for compliance. Extension of time was granted and terms were also modified. However, the terms imposed were not adhered to and complied as only part payments were made. Noncompliance is admitted. 12. The Tribunal on 7th February, 1996 dismissed the appeals fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... application was filed before the BIFR is not indicated. Reference application before the BIFR was registered as Case No.17/97. A scheme was approved and sanctioned on 16th December, 2002. As per the appellant, BIFR had directed refund/ withdrawal of pre-deposit and had directed non imposition of pre deposit during the rehabilitation period. No application was filed before the Tribunal for revival of the appeals. Net worth of the appellant turned positive during the financial year ending 31st March, 2007 and the BIFR vide order dated 29th June, 2007 had discharged the appellant from purview of the enactment relating to sick companies, though as per the appellant direction to implement provisions of the scheme and monitoring before the BIFR had continued. Even thereafter, no application was filed before the Tribunal for ten years, till 2017. The appellant clearly accepted the order of the Tribunal and did not seek revival of the appeals and hearing on merits. 17. In view of the aforesaid discussion, we do not find any valid ground or reason to interfere with the impugned order. The appellant has been grossly negligent and derelict. Their inaction reflects acceptance and abandonment. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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