IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.K.ABDUL REHIM TUESDAY, THE 21ST JUNE 2011 / 31ST JYAISHTA 1933 WP(C).No. 15361 of 2011(U) -------------------------- PETITIONER(S): --------------- ROSE BED ROLLS, PARACKA HOUSE, KARIPPAYI ROAD, RAJAGIRI PO, KALAMASSERY, COCHIN-683 104, REP.BY ITS PARTNER MR.ANTONY THARU. BY ADV. SRI.E.K.NANDAKUMAR SRI.A.K.JAYASANKAR NAMBIAR SRI.K.JOHN MATHAI SRI.P.BENNY THOMAS SRI.P.GOPINATH RESPONDENT(S): --------------- 1. THE UNION OF INDIA, REP.BY THE SECRETARY MINISTRY OF FINANCE, DEPARTMENT OF REVENUE, NORTH BLOCK, NEW DELHI-110 001. 2. THE COMMISSIONER OF CENTRAL EXCISE, CUSTOMS & SERVICE TAX, C.R. BUILDING, I.S. PRESS ROAD, COCHIN-682 108. 3. THE CUSTOMS EXCISE & SERVICE TAX, APPELLATE TRIBUNAL, (SOUTH ZONAL BENCH), WTC IST FLOOR, FKCCI COMPLEX, K.G.ROAD, BANGALORE-560 009. BY ADV. SRI.THOMAS MATHEW NELLIMOOTTIL, SC, FOR R1-2 THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 21/06/2011, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: ami/ WP(C).No. 15361 of 2011(U) APPENDIX PETITIONER'S EXHIBITS :- P1 : COPY OF THE AGREEMENT ENTERED INTO BY THE PETITIONER WITH THE RAILWAY ADMINISTRATION, DATED 5.6.2006 P2 : COPY OF THE ORDER-IN-ORIGINAL NO.12/2010/ST PASSED BY THE 2ND RESPONDENT DATED 18.2.2010 P3 : COPY OF THE APPEAL PREFERRED BY THE PETITIONER BEFORE THE 3rd RESPONDENT APPELLATE TRIBUNAL, DATED 12.4.2010 P4 : COPY OF THE APPLICATION FOR DISPENSING WITH PRE-DEPOSIT OF TAX AMOUNT, PREFERRED BY THE PETITIONER BEFORE THE 3rd RESPONDENT APPELLATE TRIBUNAL DATED 12.4.2010 P5 : COPY OF THE ORDER OF THE 3rd RESPONDENT APPELLATE TRIBUNAL, DATED 2.5.2011 P6 : COPY OF THE BALANCE SHEET OF THE PETITIONER AS ON 31.3.2010 RESPONDENTS' EXHIBITS : - NIL Sd/- C.K.ABDUL REHIM, JUDGE //TRUE COPY// P.A.TO JUDGE ami/ C.K.ABDUL REHIM, J. ------------------------------- W.P.(C).No.15361 of 2011 ------------------------------- Dated this the 21st day of June, 2011. J U D G M E N T Challenge in this writ petition is against Ext.P5 order passed by the Customs Excise and Service Tax Appellate Tribunal (CESTAT). The petitioner had approached the Tribunal challenging Ext.P2 order, in Ext.P3 statutory appeal. The petitioner had submitted Ext.P4 application along with the appeal, seeking to dispense with pre-deposit of the tax amounts, as required under Section 83 of the Finance Act 1994. Considering such application, Ext.P5 order was issued by the CESTAT insisting upon the petitioner to make pre-deposit of an amount of Rs.30 lakhs within a period of 8 weeks from the date of the order. 2. According to the petitioner, the condition was imposed in a mechanical manner and it had caused onerous liability upon the petitioner, which he could not comply with, considering the present financial situations. It is conceded that the total liability arising out of Ext.P2 order is about 2 W.P.(C).No.15361 of 2011 Rs.99 lakhs. However, the petitioner sought interference of this Court in altering the condition imposed and also in directing the Tribunal to have an early disposal of the appeal. 3. In the counter affidavit filed on behalf of respondents 1 and 2 it is pointed out that, the pre-deposit is a condition insisted through the relevant statute and the provisions enabling waiver of such condition, has been exercised by the Tribunal with a due diligence. It is pointed out that, only less than 1/3rd of the amount was insisted upon to be paid. It is further pointed that the Honourable Supreme Court in Indunissan Oxo Chemicals Industries Ltd. Vs. UOI {2008 (221) ELT.7(SC)} held that, while exercising the power of waiver of precondition, the authority should also safeguard all the interest of the revenue. Therefore, it is contended that there is no infirmity with Ext.P5 order and the writ petition is not sustainable. 4. Considering the rival contentions as above, I am of 3 W.P.(C).No.15361 of 2011 the view that, the Tribunal had considered all the aspects of the matter. It is after evaluation of merits of the contentions raised, that the Tribunal found that a prima facie case has not been made out for complete waiver of the amounts involved. The power for waiver of the precondition is a discretion vested on the appellate authority by virtue of the statute. Unless there is a total lack of exercise of such discretion or a totally erroneous exercise of the discretion, it may not be justifiable on the part of this Court to interfere with. It is evident from Ext.P5 that, such an order was issued after proper application of mind and with due consideration to the contentions raised. Therefore, I am of the view that, the order does not call for interference by this Court. However, considering the fact that the petitioner had challenged the order before this Court, I am inclined to extent the period stipulated for compliance of the condition. 5. Accordingly, while dismissing the writ petition, the petitioner is allowed to make pre-deposit of the amount of Rs.30 lakhs insisted upon through Ext.P5, in 2 (two) equal 4 W.P.(C).No.15361 of 2011 monthly instalments falling due on or before 15.7.2011 and 15.8.2011. 6. It is made clear that on payment of the amounts as stipulated above, the appeals shall be entertained and disposed of on merits. Recovery of the amounts covered under Ext.P2 shall be kept in abeyance till the disposal of the appeals in question, if the petitioner makes compliance of the above conditions. C.K.ABDUL REHIM, Judge ami/