Delhi High Court
Commissioner Of Customs vs M/S Lindt Exports on 27 September, 2011
Author: A.K.Sikri
* THE HIGH COURT OF DELHI AT NEW DELHI
% Decision Delivered On: 27th September, 2011
+ CUS AA No. 39 of 2011
COMMISSIONER OF CUSTOMS ... APPELLANT
Through: Mr. A.S. Chandhiok, ASG
with Mr.Satish Kumar, Adv.
VERSUS
M/S LINDT EXPORTS ... RESPONDENT
Through: Mr. Pradeep Jain,
Mr. Shubhankar Jha,
Mr.Tarun Chawla, Advs.
+ CUS AA No. 40 of 2011
COMMISSIONER OF CUSTOMS ... APPELLANT
Through: Mr. A.S. Chandhiok, ASG
with Mr.Satish Kumar, Adv.
VERSUS
M/S HIGH TECH ENGINEERS ... RESPONDENT
Through: Mr. Pradeep Jain,
Mr. Shubhankar Jha,
Mr.Tarun Chawla, Advs.
+ CUS AA No. 41 of 2011
COMMISSIONER OF CUSTOMS ... APPELLANT
Through: Mr. A.S. Chandhiok, ASG
with Mr.Satish Kumar, Adv.
VERSUS
RAJESH VERMA ... RESPONDENT
Through: Mr. Pradeep Jain,
Mr. Shubhankar Jha,
CUS AA No. 39-41/2011 Page 1 of 8
Mr.Tarun Chawla, Advs.
CORAM :-
HON'BLE MR. JUSTICE A.K. SIKRI
HON'BLE MR. JUSTICE SIDDHARTH MRIDUL
A.K. SIKRI, J. (ORAL)
1. It is not necessary to discuss the merits of the case as we are
concerned with the impugned order passed by the Tribunal restoring
the appeal of the respondent herein filed before the Tribunal on
deposit of Rs.2.5 Crores which payment was directed to be
deposited as condition precedent for hearing the appeal.
2. We may note at the outset that these appeals were dismissed by the
Tribunal on the earlier occasion with the order of the pre-deposit not
complied with. The revenue/appellant has filed these appeals
challenging the common order dated 3rd June, 2011 passed by the
CESTAT in Appeal Nos. 609/2006, 610/2006 and 611/2006. On the
information received by DRI that the consignees at Russia, to whom
various goods were being exported from India under repayment of
State Credit Scheme, were either non-existent or had made no
import/export operation, searches were carried out at the office of
the respondents situated in Janakpuri, New Delhi. According to the
Department, various incriminating documents and rubber stamps of
various firms/companies were resumed under panchnama.
3. The investigation resulted that M/s Lindt Exports and one M/s High
Tech Engineers, both of which were proprietorship concerns of
Mr.Rajeev Verma had availed drawback amounting to
Rs.20,90,13,652/- which included an amount of Rs.20,62,86,626/-
on exports purportedly made by the respondents during 1998-2004.
It was the allegation of the Department that there was no such
exports made and these were shown to have been made to the parties
which were non-existent.
4. Show cause notice was issued to the respondent demanding the
fraudulently availed drawback of Rs.22 Crores. The respondent
filed reply to the show cause notice. Thereafter, the matter was
heard and the adjudicating authority passed order dated 31 st May,
2006 confirming the demand made in the show cause notice.
5. The respondents preferred appeals thereafter. Along with the
appeals, respondents also preferred applications for stay of the
impugned demand made by the Commissioner of Central Excise
(Adjudication).
6. In this application, order was passed by the CESTAT on 29th
December, 2006 directing the respondents to deposit Rs.2.5 Crores
within eight weeks as against the demand of Rs.22 Crores. For
compliance, the matter was fixed for 5th March, 2007. The
respondents did not comply with the aforesaid directions which
resulted in the dismissal of the appeals.
7. Against the aforesaid order passed by the Tribunal dismissing the
appeals, the appellants approached this Court challenging the said
orders. The appeals of the appellants were, however, dismissed by a
Division Bench of this Court with the following concluded remarks:
"Against the order requiring the Appellants to refund the
drawback amount, they preferred an appeal before the
Tribunal which as already noticed required them to make
a pre-deposit of Rs.2.5 Crores as a condition for hearing
the appeal. Since the Appellants did not deposit the
amount, the Tribunal by the impugned order dated 26th
March, 2007 dismissed the appeals.
Given the facts and circumstances of the case as noticed
hereinabove, we do not find any ground to interfere with
the impugned order dated 26th March, 2007 or even the
order dated 29th December, 2006 passed by the Tribunal
concerning the pre-deposit. The Appellants have
enriched themselves by Rs.22 Crores and could have
surely deposited Rs.2.5 crores as required by the
Tribunal.
No substantial question of law arises for determination.
Dismissed."
8. It is clear from the above that order of the Tribunal dismissing the
appeals stood merged with the order of this Court which has
affirmed the order of the Tribunal. In fact, the respondents had even
preferred Special Leave Petition which was dismissed by the
Supreme Court on 10.7.2007. Thus, the order of the Tribunal
dismissing the appeals had attained finality.
9. Long after the matter rested with the respondents taking up the same
up to Supreme Court, these respondents filed applications before the
Tribunal for revival of the appeals on the ground that they were
ready and in a position to deposit Rs.2.5 Crores as per the interim
orders which was passed by the Tribunal during the pendency of the
appeals before it. These applications have been allowed by
CESTAT vide impugned orders dated 3.6.2011 on the ground that
the appeals were dismissed for non-deposit of the said amount and
once the appellants are making a pre-deposit of Rs.2.5 Crores as
ordered, they should not be denied the opportunity to get the appeals
heard on merits. This order is subject matter of challenge in the
present appeals which are admitted on the following substantial
questions of law:
"a) Whether the learned CESTAT has got jurisdiction
under the provisions of the Customs Act, 1962 to restore
the appeals dismissed by it four years ago, by reviewing
its order particularly when the order passed by the
CESTAT has merged with the order passed by the High
Court in Appeal No. CUS A No.15/2007 which has
attained finality?
b) Whether the impugned order is non-est being
passed by the learned CESTAT in exercising its powers
under Section 129 of the Customs Act, 1962 especially
when the CESTAT has not been conferred with the
power of review and the order dated 26.3.2007 passed by
the CESTAT has merged with order dated 9.10.2007
passed by this Court in Appeal No. CUS A No.15/2007
ignoring that as on the date of passing the impugned
order, there was neither any order before the CESTAT
for recalling nor any appeal pending for restoration.
c) Whether the impugned order does not amount to
interference in the due process of the High Court of Delhi
in so much as that the order dated 26.3.2007 passed by
the CESTAT has merged with the order dated 9.10.2007
passed by this Court in Appeal No. CUS A No.15/2007
and, therefore, there was no order before the CESTAT
for recalling and no appeal pending for restoration?
d) Whether the impugned order of the CESTAT
suffers from illegality being contrary to the provisions of
Section 129B(2A) of the Customs Act, 1962 which reads
thus:
SECTION 129B. ORDERS OF APPELLATE
TRIBUNAL.-
(1) The Appellate Tribunal may, after giving the parties
to the appeal, an opportunity of being heard, pass such
orders thereon as it thinks fit, confirming, modifying or
annulling the decision or order appealed against or may
refer the case back to the authority which passed such
decision or order with such directions as the Appellate
Tribunal may think fit, for a fresh adjudication or
decision, as the case may be, after taking additional
evidence, if necessary.
(1A) The Appellate Tribunal may, if sufficient cause is
shown, at any stage of hearing of an appeal, grant time to
the parties or any of them and adjourn the hearing of the
appeal for reasons to be recorded in writing:
Provided that no such adjournment shall be granted more
than three times to a party during hearing of the appeal.
(2) The Appellate Tribunal may, at any time within six
months from the date of the order, with a view to
rectifying any mistake apparent from the record, amend
any order passed by it under sub-section (1) and shall
make such amendments if the mistake is brought to its
notice by the Commissioner of Customs or the other
party to the appeal:
Provided that an amendment which has the effect of
enhancing the assessment or reducing a refund or
otherwise increasing the liability of the other party shall
not be made under this sub-section, unless the Appellate
Tribunal has given notice to him of its intention to do so
and has allowed him a reasonable opportunity of being
heard.
(2A) The Appellate Tribunal shall, where it is possible
to do so, hear and decide every appeal within a period of
three years from the date on which such appeal is filed:
Provided that where an order of stay is made in any
proceeding relating to an appeal filed under sub-section
(1) of section 129A, the Appellate Tribunal shall dispose
of the appeal within a period of one hundred and eighty
days from the date of such order:
Provided further that if such appeal is not disposed of
within the period specified in the first proviso, the stay
order shall, on the expiry of that period, stand vacated.
(3) The Appellate Tribunal shall send a copy of every
order passed under this section to the Commissioner of
Customs and the other party to the appeal.
(4) Save as otherwise provided in section 130 or section
130E, orders passed by the Appellate Tribunal on appeal
shall be final."
10. We have also heard the matter finally. It is clear from the narration
of facts that CESTAT had dismissed the appeals finally vide orders
dated 26.3.2007 and the said order was upheld by this Court as the
appeals of the respondents were dismissed on 9.10.2007. Doctrine
of merger, therefore, shall clearly apply and once the order of the
Tribunal had attained finality and had been merged in the order of
this Court, the Tribunal had become functus officio and had no
jurisdiction to entertain the applications preferred for restoration of
appeals. We, thus, answer the question in favour of the revenue and
as a result, set aside the order of the Tribunal on this ground alone.
(A.K. SIKRI)
JUDGE
(SIDDHARTH MRIDUL)
SEPTEMBER 27, 2011 JUDGE
pk
