Hynoup Food and Oil Industries Ltd. vs Union of India

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Akil Abdul Hamid Kureshi, J.—The petitioners have challenged an order dated 22-1-2004 passed by CEGAT. The petition arises in the following background. Petitioner No. 1 is a company. On 26-2-1991, officers of the central excise department during the visit to factory premises of petitioners'' company noticed certain irregularities in clearing goods on misdeclaration. On 12-5-1992, a show cause notice was issued seeking recovery of excise duties and imposition of penalty. Commissioner of Central Excise passed the order-in-original on 18-5-1994 confirming the duty demand of Rs. 54 lakhs (rounded off) with interest. He also imposed penalties. Against such order-in-original, the petitioner preferred appeal before the Tribunal. Pending such appeal, the Tribunal required the petitioner to deposit a sum of Rs. 20 lakhs within 8 weeks from the date of receipt of the order i.e. 6-3-1995. On 29-7-1999, in such appeal, the Tribunal passed the order remanding the proceedings for fresh consideration by the Commissioner. The Commissioner passed a fresh order, dated 28-3-2000 in which it confirmed the duty demand of Rs. 54.05 lakhs with interest. He also imposed penalty of Rs. 54.05 lakhs and personal penalty of Rs. 10 lakh each on two directors. The petitioner challenged the same before the Tribunal. Along with such appeal, the petitioner prayed for stay also. Though the order passed by the Tribunal on such stay petitions are not on record, we have gathered basic facts from the draft writ petition of 2004 as at Annexure-K to the petition giving certain factual details. We are informed that such petition was never circulated for the reasons best known to the petitioner. Be that as it may, from such petition it emerges that the Tribunal passed order in November, 2000 requiring the petitioner to deposit entire amount by way of pre-deposit. In July, 2001, the petitioner has sought modification of the order which was rejected in September, 2001 along with rejection of appeals.

In February, 2002, the petitioner requested for restoration of the appeals on the ground that the company was registered with BIFR. In April, 2002 such application was also dismissed however, with liberty to move fresh application. Even the petitioner-company was declared as a sick unit. Finally in 2004, the petitioner moved a fresh application with the Tribunal requesting for restoration of appeals. On such application, the Tribunal passed its impugned order on 22-1-2004. The Tribunal noted that the proceedings before the BIFR was still pending and BIFR has not yet declared the company as a sick unit. The petitioner also offered to deposit a sum of Rs. 5 lakhs and prayed for such modification of order of pre-deposit. The Tribunal however, dismissed such application. It is against this order that the petitioner has filed the present petition.

Only on the ground of gross delay and laches on part of the petitioner, we are not inclined to entertain this petition. As we have noted the issue is pending since 1994. Several orders have been passed by different authorities at different stages. The Tribunal''s order requiring the entire amount by way of pre-deposit was never challenged by the petitioners further. Such order passed in the year 2001, thus became final. The petitioner could not comply with the directions. The appeals were also dismissed. Several applications were filed for modification of stay order/restoration of appeals. Such applications were also dismissed. Last of such applications was dismissed on 22-1-2014. More than 10 years have passed in the meantime. No explanation is coming forth why such belated approach should be permitted before the Court. Merely suggesting that the petition though filed was not moved or that because of financial difficulties, the petitioner could not approach the High Court, would not be sufficient.

The financial hardship would certainly be one of the grounds for considering what should be the appropriate condition for pre-deposit for entertaining the appeal. However, merely on such financial hardships, writ petition after more than 10 years cannot be entertained. There is no other explanation coming forth. Petition is therefore, dismissed.