CESTAT has power to restore an appeal, which has been dismissed for any reason including for non-compliance of a deposit order: High Court
CESTAT by an order dated 25.09.2012 directed the appellants to deposit the tax within 8 weeks. By yet another order dated 15.04.2013, the time to deposit the amounts was extended upto 20.04.2013. On 22.04.2013, the appellant filed an application for a further extension. The appellants had failed to deposit the amounts. On 27.04.2013, the appellants deposited the entire amounts. Accordingly, they made an application for restoration of the appeal, which had been dismissed in default on 20.04.2013. There was, therefore, a delay of only 7 days in complying with the orders requiring the appellants to deposit the amounts. The application for extension of time filed on 22.04.2013 and the application for restoration were, however, dismissed by the order of the Tribunal dated 26.09.2013.
The assessee approached the High Court against the dismissal of the appeal and application for restoration.
The High Court observed,
We do not see any reason to deny the appellants an extension of a mere 7 days. It would be grossly inequitable and unfair to deny the appellants an opportunity of having their case heard on merits on account of their having delayed in complying with the order by just 7 days.
The contention that the CESTAT does not have power or jurisdiction to grant an extension of time or to restore the appeal is not well founded .
The High Court noted that as per Section 86(6A)(b), the application fee for an application for restoration of an appeal, is Rs. 500/-. This presupposes the maintainability of an application for restoration of an appeal .
The High Court also referred to Rule 41 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 which reads as:-
The Tribunal may make such orders or give such directions as may be necessary or expedient to give effect or in relation to its orders or to prevent abuse of its process or to secure the ends of justice .
The High Court held that the concluding words "to secure the ends of justice" are wide enough to cover cases such as these viz. to grant an extension of time to deposit an amount or to restore appeals dismissed on account of the failure to comply with the orders of pre-deposit.
So, the High Court restored the appeal to the file of the CESTAT to be heard on merits.