ORDER
1. These two Writ Petitions are connected and can be disposed of together. The matter relates to the pre-deposit of duty as a condition precedent for maintaining appeals before the Customs, Excise and Gold (Control) Appellate Tribunal (hereinafter called “CEGAT”). On an earlier occasion the CEGAT had passed two orders – one on 17-8-1993 and another on 19-8-1993 in the two connected matters stating that taking into consideration all facts and circumstances of the case, including prima facie case and liquidity position of the appellants before it, as well as the interest of Revenue, the appellants should be directed to deposit the various amounts mentioned in Para 38 of the said order as well as furnish bank guarantee for the balance of the amount of duty wherever short pre-deposit had been directed within three months from the date of receipt of the order. It was not disputed before us that in the two cases put together the result of the above order of the CEGAT is that the petitioners should deposit Rs. 35 crores in cash and furnish bank guarantee for the balance amount of Rs. 55 crores. Against the said orders, two writ petitions were filed in this Court bearing Nos. C.W.P. 5127 of 1993 and C.W.P. 5130 of 1993. On 9-11-1993 the said writ petitions were withdrawn. C.W. No. 5127 of 1993 was argued for 2 days before it stood withdrawn as stated above. The withdrawal was made by the petitioners with a view to approach the CEGAT for modification. Thereafter, the petitioners filed applications for modifications before the CEGAT and those applications have been disposed of by a common order dated 27-1- 1994. The applications for modification were dismissed resulting in the previous orders passed by the CEGAT operating against the petitioners. Of course, time for compliance of the previous directions was extended. The petitioners have approached this Court once again by questioning the orders of the CEGAT refusing to modify the earlier orders.
2. In this appeal we have heard learned counsel for the petitioners and the learned Additional Solicitor General on behalf of the department. The arguments covered a wide field, namely, the prima facie case and the hardship which the petitioners may suffer, if the pre-deposit as directed by the CEGAT is to be complied with. The jurisdiction of this Court under Article 226 of the Constitution of India is limited while reviewing orders of pre-deposit passed by the CEGAT. In the present case, the CEGAT passed discretionary orders on an earlier occasion, as stated above, and the petitioners made a second attempt to have the orders modified by the CEGAT. They did so after withdrawing the earlier writ petitions filed by them in this Court. Even after the matter went back, the CEGAT was not inclined to take a different view of the matter.
3. During the course of the submissions in this court learned counsel for the petitioners submitted that the financial liquidity of the company was not sufficient so as to meet the orders of deposit directed by the CEGAT and, therefore, offered to pay Rs. 2 crores by the end of May, 1994, Rs. 5 crores by 31-3-1995 and another Rs. 5 crores by 31-3-1996 and Rs. 3 crores by 31-10-1996. Learned counsel for the petitioners offered to deposit certain share certificates of U.P. Cements, which according to the petitioners have a value of Rs. 5 crores. Learned counsel also offered to give an undertaking in having a resolution of the Board of Directors of the company placed before the Court to the effect that the petitioners would not encumber or alienate their assets in any manner.
4. On the other hand, learned Additional Solicitor General pointed out that according to the analysis of the Government of the financial position of the petitioners’ financial position was quite good and he also relied upon a supplementary affidavit filed by one Mr. Sushil Solanki. In reply to the said supplementary affidavit, the petitioners relied upon a rejoinder filed by one Mr. V.K. Handa. Reference was also made to the balance-sheets of the company and the various particulars mentioned therein.
5. One of the points urged before us was that for the purpose of furnishing bank guarantee the petitioners might have to deposit the cash equivalent of the bank guarantee to obtain bank guarantee from the banks and that, therefore, virtually this would amount to asking the petitioners to find the cash for the total amount of duty as assessed.
6. After considering the various submissions made by the learned counsel on both sides and after considering the earlier order of the CEGAT and the later orders of CEGAT, we are of the view that the following modification of the order of the CEGAT dated 27-1-1994 would meet the ends of justice and would be within the scope of our jurisdiction under Article 226 of the Constitution of India.
7. We are of the view that the petitioners should deposit Rs. 35 crores in cash as determined by CEGAT and this part of the order of CEGAT is confirmed.
8. So far as the bank guarantee for Rs. 55 crores is concerned, having regard to the need for finding cash equivalent to be made available to the banks for providing the bank guarantee, we are inclined to dispense with the same subject to certain conditions. The CEGAT considered that so far as the balance amount is concerned, bank guarantee for Rs. 55 crores would suffice and no cash deposit for the balance was necessary for hearing of the appeal. Instead of the bank guarantee, as directed by the CEGAT, we are modifying that part of the order to this extent by imposing further conditions, namely, that the petitioners shall not alienate their assets and encumber the same in any manner whatsoever, without the permission of this Court pending disposal of the appeal before the CEGAT. They shall also file a resolution of the Board of Directors on behalf of the company that the company would not encumber or alienate any of its assets without the permission of this Court pending disposal of the appeal before the CEGAT. The petitioners shall also file a list of its assets in relation to immovable properties in this Court within 2 weeks from today and the above said undertaking and resolution in relation to the said properties.
9. Time for depositing the cash amount, as mentioned above, is three months from today.
10. Subject to the above modification of the order of the CEGAT, these writ petitions are disposed of.