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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION

CENTRAL EXCISE APPEAL NO. 94 OF 2010 

M/s.Hanila era Textiles Ltd. ...  Appellant.

V/s.

Union of India and others. ...  Respondents.

J.J.Bhatt, Senior Advocate with A.M.Sethna i/b.
J.B.Ansari for the appellant.

R.V.Desai, Senior Advocate with R.B.Pardeshi
for the respondents.

CORAM : V.C.DAGA AND R.M.SAVANT, JJ.

DATED :  21st September 2010.

P.C. :

Heard Shri Bhatt, learned senior counsel for the 
appellant   and   Shri   Desai,   learned   senior   counsel   for   the 
respondents.  Perused appeal.

2. This appeal is directed against the order of the 
Customs,   Excise   and   Service   Tax   Appellate   Tribunal,   West 
Zonal   Bench   at   Mumbai   (“Tribunal”   for   short)   whereby   and 
whereunder the appeal filed by the appellant was dismissed 
for noncompliance of the order directing pre­deposit in the 
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sum of Rs.3 crore under section 35F of the Central Excise 
Act, 1944 (“Act” for short).

The Facts : 

3. The   facts   giving   rise   to   the   present   appeal 

relevant to the issue involved, in nutshell, are as under:

4. The appellant herein is a 100% EOU engaged in the 
manufacture   of   various   yarn   products   attracting   central 
excise duty under the Central Excise Tariff Act, 1985.  The 
appellant   submitted   an   application   for   permission   to   sell 
yarn   produced   by   it   in   DTA   to   Development   Commissioner, 
SEEPZ which was granted to the extent of Rs.16,88,78,212/­ 
as against Rs.19,29,90,000/­ claimed by the appellant.  The 
order to the extent it denied permission was challenged in 
Writ   Petition   No.2388/2000   before   this   Court.     This  Court 
was pleased to direct the Development Commissioner to grant 
full entitlement.  Accordingly, the appellant requested the 
Development   Commissioner   to   grant   further   permission   for 
the balance entitlement of Rs.12,82,90,000/­ as directed by 
this Court vide its order dated 31st October, 2001 passed in 
Writ Petition No.2388/2000, which was ultimately granted by 
the   Development   Commissioner   vide   his   order   dated   9th 
January, 2002.

5. The   Development   Commissioner,   vide   his   order 

dated   4th  June,   2003   reviewed   the   aforesaid   order   and 
cancelled the permission.   The review order was passed by 
the   Development   Commissioner   without   show­cause­notice   to 
the   appellant   and   without   affording   any   opportunity   of 
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hearing   in   that   behalf.     The   said   order   of   review   was 

challenged   by   the   appellant   by   filing   Writ   Petition   No.
1718/2003 before this Court which is still pending.

6. The   Assistant   Commissioner   of   Central   Excise, 

Khopoli Division Mumbai issued show­cause­notice dated 25th 
July, 2003 demanding duty in respect of the goods sold by 
the   appellant   in   terms   of   the   permission   dated   7th  June, 
1999.     The   said   show   cause   notice   is   challenged   by   the 
appellant   in   Chamber   Summons   No.241/2003   in   Writ   Petition 
No.1718/2003  and the same is also pending.  

7. The   appellant   submitted   written   submission   dated 

22nd  February,   2005   to   the   Commissioner,   Central   Excise 
(Adj.)   resisting   the   show   cause   notice   dated   25 th  July, 
2003.  

8. The   Commissioner   of   Central   Excise   adjudicated 

and   confirmed   the   show­cause­notice   vide   order­in­original 
dated   12th  August,   2005   and   demanded   duties   of   excise 
equivalent to the aggregate duties of customs under proviso 
(i) to section 3(1) of the Central Excise Act, 1944 to the 
extent of Rs.3,73,82,248/­.  

9. The   appeal   filed   to   the   Tribunal   against   the 

aforesaid   order   resulted   in   remanding   the   matter   to   the 
Commissioner   of   Central   Excise   for   consideration   afresh 
vide order dated 25th August, 2006.  

10. On   remand,   impugned   order­in­original   was   passed 

by   the   Commissioner   of   Central   Excise,   Raigad   on   30th 
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September,   2008   confirming   the   duty   demand   of   Rs.11.92 

crore   and   penalty   against   the   earlier   demand   of   Rs.
3,73,82,248/­.  

11. Aggrieved   by   the   aforesaid   order,   the   appellant 

preferred   appeal   before  the  Tribunal.     The   Tribunal,   vide 
its order dated 3rd  September, 2009 directed the appellant 
to pay Rs.3 crore by way of pre­deposit under section 35F 
of the Act within a period of eight weeks.  The  compliance 
was to be reported on 9th November, 2009.  

12. The   aforesaid   order   directing   pre­deposit   was   a 

subject   matter   of   challenge   in   Writ   Petition   No.2195/2009 
filed before this Court.   During the pendency of the said 
petition,   appeal   was   dismissed   by   the   Tribunal   vide  order 
dated 11th June, 2010 for noncompliance of the order of pre­
deposit.   Consequently, Writ Petition No.2195/2009 came to 
be   dismissed   vide   order   21st  June,   2010   holding   it   to   be 
infructuous.     Now   under   order   dated   6th  August,   2010,   the 
respondents have attached the goods of the appellant.   The 
appellant   has   now   filed   present   appeal   challenging   the 
orders   dated   11th  June,   2010,   3rd  September,   2009   together 
with attachment order dated 6th  August, 2010 and prayed for 
interim reliefs in terms of prayers made in the appeal.

Rival Submissions :

13. Mr.Bhatt,   learned   senior   counsel   appearing   for 

the   appellant   urged   that   the   order   directing   pre­deposit 
was   a   subject   matter   of   challenge   in   Writ   Petition   No.
2195/2009,   as   such   it   was   obligatory   on   the   part   of   the 
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Tribunal   to   wait   till   the   order   of   this   Court   deciding 

question of pre­deposit.   That the Tribunal was, thus, not 
justified in dismissing the appeal for noncompliance of the 
order of pre­deposit.   He, thus, submits that the impugned 
order   dismissing   appeal   be   set   aside   and   the   appeal   be 
restored to the file of the Tribunal.  In addition to this, 
it   is   also   urged   that   the   order   dismissing   appeal   was   in 
breach   of   principles   of   natural   justice   as   such   impugned 
orders are void ab initio.

14. Mr.Desai,   learned   senior   counsel   appearing   for 

the   respondents­   Revenue   vehemently   opposed   the   aforesaid 
submission made by learned counsel for the appellant.   He 
urged   that   Writ   Petition   No.2195/2009   was   filed   on   7th 
November,   2009   and   the   same  was  deliberately   kept   pending 
right   up   to   June,   2010   i.e.   for   seven   months   without 
seeking any order.   No attempt was made to get the matter 
circulated   and   obtain   appropriate   orders   from   the   writ 
Court.  

15. Mr.Desai   further   submits   that   the   Tribunal’s 

order   directing   pre­deposit   was   suffered   by   the   appellant 
on   3rd  September,   2009.     The   petition   was   filed   on   7th 
November,   2009.     The   order   of   pre­deposit   was   to   be 
complied with within a period of eight weeks and compliance 
was to be reported on 9th November, 2009.  He, thus, submits 
that   just   two   days   before   the   expiry   of   period   meant   for 
compliance   of   the   order   of   pre­deposit,   appellant   filed 
writ petition.  On the top of it, it was deliberately kept 
pending   till   June   2010.     No   orders   were   obtained. 
Consequently, appeal filed before the Tribunal was rightly 
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dismissed by the Tribunal for noncompliance of the order of 
pre­deposit.  

16. Mr.Desai   submits   that   had   the   bonafides   of   the 

appellant   been   clear,   the   appellant   would   have   obtained 
urgent circulation from the writ Court.   According to him, 
writ petition was deliberately kept pending for a period of 
more than seven months.  It was lying in the registry.  He 
submits   that   the   Tribunal   was   perfectly   justified   in 
rejecting   appeal   for   noncompliance   of   the   order   of   pre­
deposit.  

17. Mr.Desai,   thus,   submits   that   this   is   not   a   fit 

case   for   entertaining   appeal   and   grant   of   relief   to   the 
appellant.     At   any   rate,   he   submits   that   no   substantial 
question   of   law   is   involved   in   the   appeal   warranting 
consideration   thereof.    He,  thus,   prayed   for   dismissal   of 
appeal in limine with heavy costs.

Consideration :

18. Having   heard   rival   parties,   in   our   considered 

view,   Mr.Desai   is   justified   in   contending   that   no 
substantial question of of law is involved in this appeal. 

19. The   undisputed   facts   are   that   order   of   pre­

deposit   was   passed   on   3rd  September,   2009   which   was   to   be 
complied with within a period of 8 weeks i.e. on or before 
9th  November, 2009.   Whereas writ petition challenging the 
order   of   pre­deposit   was   filed   on   7th  November,   2009   i.e. 
just two days before the expiry of time granted to comply 
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with the order of pre­deposit.  No steps were taken by the 
appellant   to   get   the   petition   circulated   and   obtain 
appropriate orders from the writ Court.   The petition was 
kept pending in the registry right upto 15th June, 2010.  No 
steps were taken even before the Tribunal to get the period 
of eight weeks extended so as to comply with the order of 
pre­deposit   dated   3rd  September,   2009.     Under   these 
circumstances,   the   question   before   us   is:   whether   the 
Tribunal   was   justified   in   dismissing   appeal   for   want   of 
compliance of the order of pre­deposit dated  3rd September, 
2009.  

20. At   this   stage,   it   is   useful   to   refer   to   the 

judgment   of   the   Hon’ble   Supreme   Court   in   the   case   of 
Trilokchand   Motichand    v.    H.B.Munshi,   AIR   1970   SC   898; 
wherein the question of delay was considered by the Hon’ble 
Supreme Court in moving Court in furtherance of his right 
to seek the remedy.   The Hon’ble Supreme Court observed as 
under:

“If then   there   is no period   prescribed 

what  is  the standard  for  this  Court to 
follow? I should say  that utmost  expedition 
is   the   sine   qua   non   for   such   claims.     The 
party   aggrieved   must   move   the   Court   at   the 
earliest   possible   time     and   explain 
satisfactorily all semblance of delay.  I am 
not   indicating   any   period   which   may   be 
regarded   as the ultimate   limit of   action 
for that would  be taking   upon   myself 
legislative functions.  In England a  period 
of   6   months   has   been   provided   statutorily, 
but     that     could     be   because   there   is   no 
guaranteed   remedy   and   the   matter   is   one 
entirely of discretion. In India I will only 
say   that   each   case   will   have   to   be 
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considered   on   its   own     facts.    Where   there 

is     appearance     of   avoidable   delay     and 
this  delay affects the merits of the claim, 
this Court will consider it and  in a proper 
case hold the party disentitled   to   invoke 
the extraordinary jurisdiction.” 

(Emphasis supplied)

21. In   the   instant   case,   the   appellant   appears   to 

have calmly abandoned or at any rate put into cold storage 
his   writ   remedy   under   Article   226   of   the   Constitution   of 
India.     There   is   no   explanation   from   the   appellant   as   to 
what prevented them from getting their petition circulated 
before   the   Court   and   obtain   appropriate   orders.     In   the 
circumstances, it cannot be said that the appellant is not 
guilty of gross delay in pursuing the writ remedy that was 
open to them in the first place.   In our opinion, it does 
not matter whether the petition had been formally lodged in 
the   Court   or   not.     If   the   appellant   had   sought   a   remedy 
under   the   extra­ordinary   jurisdiction   of   this   Court,   then 
it   ought   to   have   moved   the   Court   to   obtain   appropriate 
orders   and   ought   not   have   allowed   the   time   to   elapse 
creating rights in favour of the respondents.  

22. In   the   aforesaid   view   of   the   matter,   the 

appellant   was   guilty   of   keeping   the   petition   pending   for 
seven months and not obtaining appropriate orders from the 
writ Court.  It was not obligatory on the Tribunal to grant 
further time for compliance of order of pre­deposit without 
there   being   any   such   request   from   the   appellant   before 
expiry   of  the  time  already   fixed   by  it.     The   appeal  was, 
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thus, rightly dismissed   for noncompliance of the order of 
pre­deposit.  

23. The aforesaid view of ours is in consonance with 
the view of this Court in the case of P.Narayan Pillai  v.  
T.V.Rangrajan,  1974   Mh.L.J.   352;   wherein,   in   more   or   less 
similar   facts,   writ   Court   had   refused   to   entertain 
petition.

24. We may place it in record that, during the course 
of   hearing,   it   was   suggested   to   the   appellant   to 
unconditionally   comply   with   the   order   of   pre­deposit   so 
that Revenue can be persuaded to agree for consent order to 
see   that   the   appellant   gets   an   opportunity   to   prosecute 
their   appeal   on   merits.     However,   appellant   refused   to 
comply   with   the   order   of   pre­deposit   without   putting   any 
conditions.     In   the   circumstances,   we   are   left   with   no 
other alternative but to dismiss the appeal. 

25. In the result, appeal is dismissed in limine for 
want   of   substantial   question   of   law   with   no   order   as   to 
costs.

   (R.M.SAVANT, J.)                        (V.C.DAGA J.)