M/s Rainbow Logistics vs Commissioner Of Customs

This appeal seeks quashing of the order dated May 29, 2016 passed by the Commissioner of Customs (Appeals)., The Commissioner (Appeals)

The Commissioner (Appeals) has dismissed the appeal solely for the reason that the statutory requirement of making the pre-deposit, as contemplated

under section 129(E) of the Customs Act, 1962, was not complied with.

Shri Sudhir Malhotra, learned Counsel appearing for the Appellant submitted that the Appellant had clearly stated in the Serial No. 6 in Form No.

CA 1 of the Appeal filed under section 128 of the Customs Act that the entire duty amount was deposited and appropriated in the original order

and out of the total penalty, 25 per cent of the penalty imposed under section 114A had also been deposited by Challan dated August 24, 2017 but

there is no consideration of this fact by the Commissioner (Appeals). Learned Counsel also pointed out that in case the Commissioner (Appeals) was

not satisfied that the pre-deposit has not been made, an order should have been passed after considering the aforesaid aspect and an opportunity

should have been granted to the Appellant to make the pre-deposit, but the appeal was dismissed without giving any opportunity to the Appellant to

either explain the position or to make the deposit.

Shri Rakesh Kumar, the learned Authorized Representative of the Department stated that there is no error in the order passed by the Commissioner

(Appeals), as the Appellant had not complied with the statutory requirement.

The submissions advanced by the learned Counsel appearing for the Appellant and the learned Authorized Representative of the Department have

been considered.

The relevant portion of the order passed by the Commissioner (Appeals) is reproduced below:-

“4.2 In the instant appeal, the appellant has disputed the penalty of Rupees One Crore only imposed under Section 114AA of the

Customs Act, 1962. They have not deposited the pre-deposit as mandatory under section 129E(i) of the Act, ibid. Because this appeal was

clubbed alongwith those filed by the appeals filed by s/sh. Manoj Singal and Deepak Singal, the case reached up to the point of personal

hearing. The statutory requirement of making pre-deposit has not been complied. Therefore, I hold the appeal as non-maintainable and

pass the order accordingly.â€​

In column No. 6 appellant had made the following statements.

Whether the duty or penalty or both : The entire duty of 46,72,631/- alongwith interest

deposited, if not whether any application stands deposited which is appropriated vide the

for dispensing with such deposit has impugned order-in-original. Out of total penalty an

been made. amount of Rs. 11,68,500/- (being 25% of penalty)

imposed under section 114A is also deposited vide

challan dated. August 24, 2017.

It is, therefore, clear that there is no consideration of the statement made by the Appellant in the memo of appeal nor any opportunity was granted

to the Appellant to make the pre-deposit. The Commissioner (Appeals) should have passed an appropriate order regarding the pre-deposit and if the

Commissioner (Appeals) was not satisfied, an order should have been passed and if the Commissioner (Appeal) was not satisfied, time should have

also been given to the Appellant to make the pre-deposit.

The order dated May 29 May, 2016 passed by the Commissioner (Appeals), therefore, deserves to be set aside and is set aside. The Commissioner

(Appeals) shall examine the issue relating to pre-deposit afresh and pass an appropriate order. If the Commissioner (Appeals) is not satisfied with the

submissions of the Appellant regarding pre-deposit, some reasonable time should be granted to the Appellant to make the pre-deposit. If it is held that

pre-deposit has been made or the appellant makes the pre-deposit within the time granted by the Commissioner (Appeals) and the appeal has to be

heard, then the Commissioner (Appeals) shall hear the appeal and decide the Appeal on merits without being influenced by any of the observations

made by the Commissioner (Appeals) in the connected two appeals namely Customs Appeal No. 52206 of 2019 and Customs Appeal No. 52209 of

2019.

The appeal is accordingly, allowed.

(Order dictated and pronounced in the open Court)