M/S. Alex Enterprises & Anr vs Union Of India & Ors

M/s. Alex Enterprises & Anr. ..Appellants

Versus

Union of India & Ors. ..Respondents

JUDGMENT

Dr. ARIJIT PASAYAT, J.

1. Challenge in this appeal is to the judgment of the Customs Excise and

Gold Control Appellate Tribunal, New Delhi (in short the `CEGAT'). By

the impugned order the application filed by appellants seeking waiver of the

pre deposit of duty amount of Rs.42,90,226/- and penalty of Rs.20,00,000/-

1 confirmed by the Commissioner of Customs. The High Court directed

deposit of Rs.42,00,000/- on or before 30.7.2002. Since the amount was not

deposited by order dated 7.10.2002, the appeal was dismissed.

2. Learned counsel for the appellant submitted that the CEGAT did not

consider the various questions in its proper perspective. The appellant was

entitled to the benefits of Rule 16(a) of the Customs and Central Excise

Duties Drawback Rules, 1995 (in short the `Rules') and, therefore, the

direction given by the CEGAT was not in order.

3. Learned counsel for the respondent on the other hand submitted that

the appellants have been adopting various dilatory methods and have

dragged on the whole matter for nearly eight years and no interference is

called for in a matter of this nature.

4. A brief reference to the factual scenario needs to be noted. The

Tribunal noted with reference to the orders passed by the departmental

authorities that the position was as follows:

"The perusal of the impugned order shows that the

recovery of Rs.42,90,226/- had been ordered to be made from

2 the appellants as they wrongly got this amount as draw back on

the basis of 11 shipping bills vide which the export

consignments valued at Rs.2,54,30,211/- were sent by them,

but the sale proceeds of those consignments have not been so

far realized by or on behalf of the appellants in India, within

the period allowed under the Foreign Exchange Regulation

Act. Therefore they were asked to pay back the amount of the

draw back under Section 142 of the Customs Act. The learned

counsel has not contested the correctness of the impugned

order on merits on any material on record. He has admitted

that the sale proceeds of the consignment had not been

repatriated in India so far and that the appellants had availed

the drawback of the disputed amount. Therefore, prima facie,

we do not fine any case in favour of the appellants for allowing

them total waiver of the pre deposit of the drawback amount as

well as the penalty amount.

However keeping in view the facts and circumstances of

the case, and the financial hardship of the appellants as pleaded

by the learned counsel, we direct the appellants to make pre

deposit of the draw back amount of Rs.42 lakhs on or before

3 30.7.2002. On making this deposit, the requirement to pre

deposit the balance drawback amount and the penalty amount

shall stand waived and recovery stayed till the disposal of the

appeal. However, it is made clear that if the terms of this stay

order are not complied with within the stipulated period, then

their appeal shall be liable to be dismissed under Section 129B

of the Act."

5. As noted above the time was given to deposit Rs.42,00,000/-on or

before 10.7.2002. A writ petition was filed against the order of CEGAT i.e.

Writ Petition No. 4053 of 2002. The High Court disposed of the writ

petition extending the time for making deposit till 30.9.2002 and directed to

file compliance before the CEGAT on 7.10.2002. On 7.10.2002 an

application for extension of time was filed before CEGAT stating that the

appellants were taking steps to file a review/recall application of the order

passed in the Writ Petition. The Review Petition is stated to have filed on

11.10.2002. On 22.10.2002 another application for extension of time was

filed or stated to have been filed. The Review petition was dismissed as

withdrawn on 17.12.2002.

6. It is stated by learned counsel for the appellant that liberty was

granted to move another appropriate application seeking modification of the

4 order dated 2.8.2002. On 20.10.2002, CEGAT dismissed the appeal on the

ground that the order passed by the CEGAT and the extended time granted

by the High Court to make the deposit were not complied with. A writ

petition was filed seeking restoration of the appeal which was dismissed by

the High Court on 25.3.2003. A writ petition No. 2151 of 2003 was filed

with a prayer to set aside/quash the entire subsequent proceedings. The

same was dismissed by the High Court on 25.3.2003. The appellants filed a

review petition which was numbered as RA No. 3890 of 2003 on the ground

that the undue hardship aspect was not considered by the High Court. The

same was dismissed by the High Court on 25.3.2003. SLP(C ) No. 12435 of

2003 was filed before this court against the said order of the High Court.

The same was dismissed on 28.7.2003. On 1.8.2003 the present Civil

Appeal was filed.

7. The factual scenario as noted above clearly goes to show that the

appellants adopted various dilatory methods and the present appeal is

nothing but an abuse of the process of law.

8. Learned counsel for the appellant submitted that the case has not been

heard on merits, and the effect of Rule 16(a) of the Rules have not been

5 considered. It is also submitted that some time may be granted to make

the deposit. Both the pleas are without any substance. The question of

applicability of Rule 16(a) could have been gone into the appeal filed

before CEGAT. That stage has not arrived at. The CEGAT was only

dealing with the application to dispense with the requirement of pre-

deposit.

9. The conduct of the appellant disentitle them from any relief.

Therefore this appeal is dismissed as there is no substance in the same.

There shall be no order as to costs.

........................................J. (Dr. ARIJIT PASAYAT)

........................................J. (ASOK KUMAR GANGULY) New Delhi, March 05, 2009

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