TMI Blog2017 (7) TMI 832X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the second respondent shall not entertain any appeal under sub-section (1) of Section 128, unless the appellant has deposited 7.5% of the duty demanded or penalty imposed or both, in pursuance of a decision or an order passed by an Officer of Customs, lower than the rank of Commissioner of Customs. A plain reading of the expression, 'presenting' which obtains, in proviso to Section 128 (1), as against 'entertain' which obtains, in Section 129 E, would have us, come to the conclusion that as long such appeal is presented, i.e., lodged, within the prescribed period of limitation including the condonable period, it cannot be dismissed solely on the ground that the mandatory pre-deposit of duty or penalty or both, was not made, before the expiry of the period of limitation, prescribed under Section 128 (1) read with the first proviso of the 1962 Act. Circular dated 14.10.2014, sensu stricto applies only vis-a-vis appeals filed with the Tribunal. Therefore, according to the procedure prescribed in the said Circular, the appellants are required to be given, at least three opportunities for processing necessary evidence of having made the prescribed mandatory pre-deposit. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r discussion. 4.Be that as it may. As alluded to above, what is required to be considered by the Court, in the present appeals is, as to whether or not, the appeals which were lodged by the appellants within the condonable period, i.e., beyond the period of limitation of 60 days, but, within the period of 30 days thereafter, could be rejected, on the ground that when the pre-deposit of 7.5% of the penalty was made the condonable period had already expired. 5.In order to appreciate the point in issue, we would be required to notice the following broad facts. 5.1.Before we do that, we may indicate, that we would be referring to the three appellants, by their name, for the sake of convenience. 5.2.The record shows that on 27.02.2014, at about 18.00 hours, the Police intercepted Mr.Ramki and Mr.Dilli Raja near C.B.Road, Stanley Nagar, Chennai. 5.3.Resultantly, Mr. Ramki was subjected to search, which led to recovery of one white powder coated crude gold bangle weighing 167 grams, which apparently, was worn by him as a band and two gold biscuits, weighing about 166 grams each. The gold biscuits, were apparently kept in a special cavity, provided in the jeans worn by Mr. R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y visited Imphal and collected the gold items from Mr.Ramachandran. 7.2.The details of his journey to Imphal by air were provided by Mr.Ramki. It was also indicated that since he did not know his exact address, he contacted Mr.Ramachandran on the phone, who collected him from the Airport and took him to his house. 8.In so far as Mr.Dilli Raja was concerned, he indicated that, he was in the business of real estate and that his Father-in-Law, at the time of his marriage had promised him that he would give him jewellery and that it is in this connection, he had instructed Mr.Ramki to collect the gold items from his Father-in-Law. 8.1.Mr.Ramachandran, broadly took the same stand as Mr.Dilli Raja, his Son-in-Law. 9.It is in this background, we are informed that a common show cause notice dated 21.08.2014, was issued, in which, a proposal was made for confiscation of the aforementioned gold items, and for levy of penalty. 9.1.It was, this show cause notice which was adjudicated, by the first respondent vide order dated 17.12.2015. Via, the said order, the first respondent confiscated the gold items (which, as indicated above, in all weighed 998 grams and were valued at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... med that they were required to deposit the said penalty amount in Form Tr-6 Challan, and submit the same, along with the appeal papers, at the time of admission of the appeal. 11.1.It is pertinent to note that by this time, the condonable period had already expired, despite which, the communication dated 26.05.2016 exhorted the appellants to deposit 7.5% of the penalty imposed. 12.The appellants, consequently deposited 7.5% of the penalty imposed, on 13.06.2016. The proof of deposit, was submitted by the appellants' Consultant, with the office of the second respondent on 14.06.2014. Resultantly, the appeals were fixed for hearing by the second respondent and, thereafter the order dated 18.06.2015, came to be passed. 12.1.As indicated right at the outset, the second respondent, instead of dealing with the appeals, on merits, rejected the same, on the ground, that they were barred by limitation. In brief, the reason furnished in the order dated 18.07.2016, is that, the day on which, the prescribed pre-deposit of the penalty imposed was made by the appellants, i.e., on 13.06.2016, the appeals had been rendered inefficacious on account of limitation. 13.According to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... set aside on the following grounds: (i) That the learned Single Judge while granting liberty to the appellants to prefer statutory appeals with the Tribunal, has, in a sense foreclosed the appeal remedy, by returning findings of fact on the issue of limitation. (ii) The learned Single Judge failed to appreciate that there was a perceptible difference between 'presentation of appeal' and 'entertainment of appeal'. For this purpose, the learned counsel sought to distinguish between the word 'presentation' appearing in proviso to Section 128 (2) (1) and the word 'entertain' which appears in Section 129 E (i). (iii) That the learned Single Judge failed to advert to the judgment of another Single Judge of this Court dated 05.06.2015, passed in W.P.No.217 of 2015, in the matter of: M/s.Jupiter Impex Vs. The Assistant Commissioner of Customs (Drawback) and another. (iv) That the learned Single Judge failed to appreciate the impact of the Circular dated 14.10.2014, which required the Revenue to give at least three opportunities or reminders, where mandatory pre-deposit had not been made, before taking any coercive measures. 17.This apart, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent, on 18.07.2016; (iii) The appeals, albeit, in letter format, were filed with the second respondent, by the appellants, on 16.02.2016; (iv) Upon this error been brought to the notice of the appellants, the appeals were filed in the prescribed format on 17.03.2016. These appeals were accompanied with an application for condonation of delay and for dispensing with the pre-deposit of the disputed penalty; (v) On 26.05.2016, the second respondent informed the appellants that the law relating to mandatory pre-deposit had undergone a change with effect from 06.08.2014, whereby, the power vested in the second respondent, to waive the deposit of penalty had been done away with. The appellants, were informed that they would have to make a mandatory deposit of penalty equivalent to 7.5% of the disputed amount. In this communication, the appellants were also informed, as regards, the period of limitation, which is, admittedly, 60 days from the date of receipt of the impugned order and, about the fact that if the appeal was preferred beyond the period of limitation, it had to be accompanied with an application for condonation of delay. (vi) The appellants deposited 7.5% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rtain percentage of duty demanded or penalty imposed before filing appeals.- The Tribunal or the Commissioner (Appeals), as the case may be, shall not entertain any appeal,- (i) under sub-section (1) of Section 128, unless the appellant has deposited seven and half percent of the duty demanded or penalty imposed or both, in pursuance of a decision or an order passed by an officer of customs lower in rank than the Commissioner of Customs; (ii) against the decision or order referred to in clause (a) of sub-section (1) of section 129-A,unless the appellant has deposited seven and a half percent of the duty demanded or penalty imposed or both, in pursuance of the decision or order appealed against; (iii)against the decision or order referred to in clause (b) of sub-section (1) of section 129-A, unless the appellant has deposited ten percent of the duty demanded or penalty imposed or both, in pursuance of the decision or order appealed against: Provided that the amount required to be deposited under this section shall not exceed rupees ten crores: Provided further that the provisions of this section shall not apply to the stay applications and appeals pending be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... law. 25.1.While we share the concern of Mr.Chopda, it must be said that our conclusions have to be based on the language used in the Act and not based on the likelihood of abuse of the provisions by the litigants. 25.2.Having said so, in our view, the Authorities below could follow the procedure, which has been adverted to, in the Circular dated 14.10.2014, as indicated in our interim order dated 07.04.2017. 26.The Circular sensu stricto applies only vis-a-vis appeals filed with the Tribunal. Therefore, according to the procedure prescribed in the said Circular, the appellants are required to be given, at least three opportunities for processing necessary evidence of having made the prescribed mandatory pre-deposit. 26.1.The Circular, further states that if after three opportunities, the necessary evidence is not filed, then, the appeal should be numbered and placed, for a decision before the concerned Presiding Officer. 27.In our view, the same procedure could be applied even vis-a-vis appeals preferred before the second respondent i.e., The Commissioner of Customs (Appeals-I). 27.1.To our minds if this procedure is adopted it would to a great extent address the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -section (2) of section 22, section 23 or section 27 [other than an order passed by an Assistant Commissioner (Assessment)] may, within a period of thirty days from the date on which the order was served on him in the manner prescribed, appeal against such order to the Appellate Assistant Commissioner (having jurisdiction): Provided that the Appellate Assistant Commissioner may, within a further period of thirty days admit an appeal presented after the expiration of the first mentioned period of thirty days if he is satisfied that the appellant had sufficient cause for not presenting the appeal within the first mentioned period: Provided further that in the case of an order under section 12, section 12-A, section 14, section 15 or sub-sections (1) and 92) of section 16, no appeal shall be entertained under this sub-section unless it is accompanied by satisfactory proof of the payment of the tax admitted by the appellant to be due or of such instalments thereof as might have become payable, as the case may be. 30.A perusal of the Section would show that the second proviso, on which, reliance was placed by Mr.Chopda is framed in a manner, which is perceptibly different ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eposit of tax has to be produced at the time when the appeal is taken for consideration but not at the time of presentation of the appeal. As far as issue of adjustment is concerned, it is objected that the amount had properly been adjusted. 4.As far as the first issue is concerned, it is needless to say that the conclusion arrived by the Division Bench is absolutely justified, for a condition to entertain an appeal does not mean that the memorandum of appeal shall be retuned because of such non-compliance pertaining to pre-deposit. The only consequence is that the appeal shall not be entertained which means the appeal shall not be considered on merits and eventually has to be dismissed on that ground. 6.Having heard the learned counsel for the assessee and the learned counsel for the Revenue, we are inclined to direct that the appellant shall deposit the amount as required by the Deputy Commissioner I, Commercial Taxes vide order dated 6-1-2011 by 30-9-2013 whereafter the appeal shall be heard and disposed of on merits. As far as the adjustment/refund is concerned, it is open to the appellant to initiate any independent proceeding. The conclusion of the Division Bench wi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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