Prashun Jain vs Commissioner of Cus. (Import and General)

Having heard learned Counsel for the parties, we frame the following substantial question of law:-

"Whether Customs, Excise and Service Tax Appellate Tribunal by the impugned order dated 18th July, 2014 was right in imposing the precondition on the appellant for deposit of Rs. 50 lacs for hearing his appeal on merits?"

With the consent of the parties, we take up the appeal for hearing today itself as a short and a limited issue arises for consideration.

On the last date of hearing, while issuing notice, by order dated 12th September, 2014 we had recorded that we would not like to interfere with the impugned order on merits on the factual aspects, but the Counsel for the appellant had submitted that the appellant was a Customs House Clearing Agent and his licence has been suspended for last four years. It was further submitted that the appellant being a Customs House Clearing Agent and not the importer, he was not in a position to pay Rs. 50 lacs, which was directed to be paid as a pre-deposit. We further observe that as per the order impugned before the Tribunal, the appellant has been assessed and asked to pay Customs duty of Rs. 67,29,000/- and penalty of similar amount has been imposed on him. Pursuant to the last order, the appellant has deposited Rs. 10 lacs. He has also filed his affidavit giving details of the investments made by him in the form of FDRs, saving bank accounts, bonds, securities, PPF account, including those of his spouse and children, who have not attained the age of majority. The appellant has deposited Rs. 10 lacs in terms of order dated 12th September, 2014. We have also gone through the affidavit filed by the appellant in terms of directions issued vide order dated 12th September, 2014. Spouse of the appellant is working and drawing salary for about Rs. 11 lacs per annum. Details of her FDRs and investments as well as details of FDRs and investments in the name of two children and the PPF account of the spouse have been indicated. It is stated that the appellant, his spouse and minor children do not own any immovable property.

The impugned order dated 18th July, 2014 records the contention of the appellant that the appellant being a Custom House Agent was not involved in the actual import and some third persons were the real culprits. Looking at the totality of facts and to give adequate and fair opportunity as well as to protect the interest of the Revenue, we feel that the pre-condition of deposit of Rs. 50 lacs is not justified and the said condition is modified as under:

(i) The appellant will deposit a further sum of Rs. 5 lacs as a precondition for hearing of the appeal.

(ii) The appellant will also furnish unconditional bank guarantee of Rs. 22 lacs to the satisfaction of the Registrar of the Tribunal stating that the bank will pay the amount in case the appellant does not succeed before the Tribunal.

The bank guarantee will be furnished within a period of four weeks from the date a copy of this order is made available to the Counsel for the appellant. Of course, the payment would abide by further orders, which would be passed by the appellate forum. We clarify that we have not expressed any opinion on the merits of the lis and the Tribunal will independently apply their mind. The question of law is accordingly answered. The appeal is disposed of.