ORDER
Jyoti Balasundaram, Member (J)
1. After hearing both sides for some time on the application for waiver of pre-deposit of Rs. 3,11,776/-, we find that it is possible to decide the appeal itself at this stage; after waiving pre-deposit, we proceed to dispose of the appeals themselves with the consent of both sides.
2. Demand of duty of Rs. 3,11,776/- was confirmed against the appellants on samples of fragrances/flavours. The duty amount was paid prior to issue of show cause notice, which was confirmed by the Jt. Commissioner, who also imposed penalty of amount equal to duty in terms of Section 11 AC of the Central Excise Act, 1944. Aggrieved by the order, the appellants filed an appeal along with application for waiver of pre-deposit before Commissioner (Appeals), contending inter alia that item in question on which demand has been raised was not marketable and hence not excisable. The lower appellate authority directed predeposit of the penalty amount and for failure to comply with the direction, the appeal was dismissed “both on merits” and for non-compliance under Section 35F of the Central Excise Act, 1944.
3. We have heard both sides. Since the amount stood paid prior to the show cause notice we waive the requirement of predeposit of penalty. We also find Ld. Counsel is correct that the Commissioner (Appeals) has not discussed any of the argument made in the appeal memorandum regarding the non-marketability and consequent non-excisability of the item. Therefore, we set aside the impugned order and remand the case to the lower appellate authority for decision on merits, after extending reasonable opportunity of hearing to the appellant.
4. The appeal is thus allowed by way of remand.
(Pronounced in Court)