M/S Poonam Construction And Co. Through One Of Its Partners, Mr Diwakar Kumar vs. Principal Commissioner , Central Goods And Service Tax And Central Excise , Ranchi

Held

The Court held that the appellate order passed by the Commissioner (Appeals) required interference. Following the precedent set by a coordinate bench in W.P.(T) No.4717 of 2022, where an appeal dismissed for non-payment of mandatory pre-deposit was allowed to be heard on merit upon the petitioner's willingness to deposit, this Court quashed and set aside the order dated 14.06.2024 passed by the Commissioner (Appeals). The appeal was revived, subject to the Petitioner depositing the pre-deposit amount as required under Section 35F of the Central Excise Act, 1944, within two weeks from the date of the order, as per their undertaking. The Court explicitly stated that it had not entered into the merits of the rival claims and the appeal would be decided in accordance with law based on the factual aspect. The garnishee notice was a consequence of the Revenue's decision, and its fate was tied to the revival of the appeal.

Facts

The Petitioner, M/s. Poonam Construction & Co., filed a writ petition challenging an Order in Original dated 09.05.2023 passed by the Assistant Commissioner (Respondent No.4) for financial years 2015-16 and 2016-17, and an Order in Appeal dated 14.06.2024 passed by the Commissioner (Appeals) (Respondent No.2). The appeal was dismissed for failure to make the pre-deposit amount as required under Section 35F of the Central Excise Act, 1944. Subsequently, a garnishee notice dated 15.04.2024 was issued. The Petitioner sought to quash these orders and the garnishee notice, arguing that they had shown willingness to deposit the pre-deposit amount but were not provided with the necessary details. The Revenue did not dispute the applicability of a previous judgment on similar facts.

Key Issues

1. Whether the dismissal of the appeal by the Commissioner (Appeals) solely on the ground of non-payment of the mandatory pre-deposit amount, despite the petitioner's willingness to deposit, warrants interference by this Court under Article 226 of the Constitution, considering Section 35F of the Central Excise Act, 1944? Petitioner's contention: The Petitioner argued that their appeal was dismissed due to non-payment of the mandatory pre-deposit, and they had shown willingness to deposit the amount. They relied on a coordinate bench's decision in W.P.(T) No.4717 of 2022, where a similar appeal dismissed for non-payment of pre-deposit was allowed to be heard on merit upon willingness to deposit. Revenue's contention: The Revenue, through their counsel, did not dispute the applicability of the judgment cited by the Petitioner.