By TIOL News Service

MUMBAI, OCT 16, 2015: AGAINST an o-in-a dated January 2012, M.K.Trading Co. had filed an appeal before the Tribunal.

This appeal was dismissed by the Tribunal on the following ground -

CX - Duty involved in the case is Rs.25,544/- and interest thereon - Order passed by Commissioner(A) u/s 35A of CEA, 1944 - in view of second proviso to section 35B of the CEA, 1944, Tribunal has discretion to refuse to admit appeal where amount of duty, amount of fine or penalty determined by such order does not exceed Rs.50,000/- (before 06/08/2014) and Rs.2 lakhs (on or after 06/08/2014) - appeal is dismissed only on the ground that duty involved is below threshold limit of Rs.50,000/- without going into the merits of the case: CESTAT [para 3, 4]

We reported this order as 2015-TIOL-2094-CESTAT-MUM.

The appellant is back with an application for Rectification of an alleged Mistake in this order.

With the support of some case laws, it is submitted as below -

+ the amount of duty involved is Rs.25,544/-. However, taking into account penalty, amount exceeds the threshold limit of Rs.50,000/- and therefore as per Section 35B(1) and proviso thereof, the Tribunal has discretion to refuse to admit the appeal in case duty or penalty or fine determined by the impugned order does not exceed Rs.50,000/-.

+ in the proviso the word 'or' should be read as 'and' to that effect the amount of duty including penalty exceeds the limit of Rs.50,000/- and, therefore, the appeal could not have been dismissed on this ground alone.

+ alternatively, in the present case, appeal has been admitted and the stay was granted, therefore at the final hearing stage this Tribunal is not correct in dismissing the appeal only on the ground monetary limit in terms of Section 35B.

The AR submitted that irrespective of whether only duty or only penalty is involved or both is involved, only one amount either duty or penalty, if it is within the threshold limit of Rs.50,000/- this Tribunal is free to exercise the discretion provided under the said proviso, therefore, the present case being involved duty amount of Rs.25,544/- which is below Rs.50,000/- order of dismissing the appeal is correct and legal. In the matter of the alternative submission made, the AR submitted that discretion by the Tribunal can be exercised at any point of time before final disposal of the appeal, therefore, merely because stay order was passed the discretion of the Tribunal does not stand taken away to decide the appeal on threshold limit.

The Single Member Bench observed -

"5. I find that proviso to Section 35 B (1) clearly provides that if the duty or penalty or fine is below Rs.50,000/- this Tribunal has discretion not to admit the appeal. Accordingly, in my view being the present case involved duty amount of Rs.25,544/- which is below Rs.50,000/- this Tribunal has discretion not to admit the appeal. I do not agree with Ld. Counsel that total amount i.e. duty, penalty and fine should be considered for the purpose of threshold limit of Rs.50,000/- as provided under Section 35 B(1). It is very clear from the provision that any of the amount i.e. either duty, or penalty or fine involved in a particular case is less than Rs.50,000/- can be disposed of as per the discretion provided under proviso to Section 35B(1). As regard the submission of the Ld. Counsel that once the stay has been granted, appeal stand admitted and therefore Tribunal could not have disposed of an appeal as per the discretion provided under Section 35B(1). I find that there is no stage prescribed under the law for exercising the discretion by the Tribunal for disposing of the appeal in terms of proviso to Section 35B(1), therefore this plea of the Ld. Counsel does not hold water. As regard the judgment of Hon'ble Madras High Court in case of EID Parry (India) Ltd. (supra) I observed that in the said judgment the amount involved was more than Rs.50,000/- and for this reason Hon'ble High Court has held that appeal should have been decided on merit. Therefore the ratio of the said judgment is not applicable in the present case. As regard other judgments relied upon by the Ld. Counsel, on going through the judgments, I find that though the amount is less than threshold limit provided in the law but appeal was entertained on merit. However these judgments do not become precedence, the discretionary power provided in proviso under Section 35B(1) can be exercised by the bench depending upon the facts and circumstances of the case…."

Holding that there is no apparent mistake in the order, the ROM application was dismissed.

(See 2015-TIOL-2207-CESTAT-MUM)