ORDER
K.S. Venkataramani, Member (T)
1. These are applications for modification of the order dated 4-3-1994 passed by the Tribunal in which the applicants herein were directed to deposit a total amount of Rs. 16 lakhs in cash and another equal amount by way of Bank Guarantee in terms of Section 129E of the Customs Act, 1962 within 16 weeks from the date of the receipt of the order. Compliance was to be reported after 20 weeks from the date of issue of the order. The learned Senior Counsel Shri A. Hidayatullah appearing alongwith the learned Counsel Shri M.P. Baxi submitted that the applicants by the present application are seeking to modify the stay order as aforesaid. The learned Counsel also informed that the applicants had challenged the stay order of the Tribunal before the Delhi High Court but their petition has been dismissed by the Delhi High Court dated July 4, 1994 holding that the High Court do not find any error in the Tribunal’s stay order. The Senior Counsel further submitted that the applicants would plead for a lenient view in the matter because of the deterioration in his finance subsequent to the passing of the Tribunal’s stay order. The learned Counsel referred to the comparative figures of the position as regards his business assets and liabilities as furnished at Annexure ‘H’ to the application by which it was indicated that the Net wealth in terms of assets and liabilities has shown a negative balance. The applicants’ firm has also suffered losses and the Chartered Accountant certificate dated 11-7-1994 was also referred to in which it has been certified that over all Mr. Sadiq A. Futehally, Net Wealth is a negative balance of Rs. 11,86,184/- as on 31-03-1994 as per Statement of Net Wealth prepared. The certificate further states that the liquidity is very poor. The learned Senior Counsel pleaded that in these circumstances the stay order should be modified and made the offer to pre-deposit of 25% in cash and pleaded for dispensing with the condition of Bank guarantee altogether as it would cause great difficulty for the applicants to raise the amount coverage necessary for obtaining the Bank guarantee. Shri B.K. Singh, the learned Senior Departmental Representative opposed very entertainment of these applications on the ground that they have been filed beyond the time given in the stay order and the stay order has, therefore, worked itself out. The applicants herein have made no efforts to comply with the stay order and instead have moved the High Court, having failed there, they have sought this modification. The learned Senior Departmental Representative pointed out that the High Court has considered their plea against the stay order and has not interfered with the order passed by the Tribunal. This it would be itself a ground for dismissing the applications. As regards the financial position, the learned Senior Departmental Representative referred to Para-20 of the Tribunal’s stay order dated 4-3-1994 and contended that the Tribunal had considered all the aspects of their financial condition, assessed their capacity to raise the necessary funds for making the pre-deposit. The learned Senior Departmental Representative pointed out that the Tribunal had noted their declaration in the Wealth Tax Report of over Rs. 93 lakhs. Further, the learned Senior Departmental Representative referred to the Balance Sheet of the firm M/s. Speedax and M/s. N. Futehally & Co. furnished now to say that the liquidity position of the two firms taken together would show a satisfactory picture. The learned Senior Departmental Representative pointed out that the firm M/s. Speedax have been granted a loan by M/s. N. Futehally & Co. and M/s. Speedax have a stock-in-trade of Rs. 27 lakhs which shows sound liquidity and in this respect the certificate to the effect that liquidity is poor is not well founded. Therefore, he urged these applications for modification of the stay order should be dismissed.
2. We have carefully considered the submissions made by both the sides. The Tribunal stay order dated 4-3-1994 has been challenged in the Delhi High Court and the High Court had dismissed the petition and passed the following order :-
CWP No. 2222/94 & C.M. 4538/94 :
This petition is directed against an order of Customs, Excise and Gold (Control) Appellate Tribunal passed in various applications of the petitioner under Section 129E of Customs Act, 1962. Various appeals were filed before the Appellate Tribunal against various orders of the Collector of Customs, Bombay New Customs House, and Collector of Customs, Nhava Sheva, where penalty totalling Rs. 30 lakhs was imposed upon the petitioner. [In the] impugned order, after discussing relevant facts, the [Appellate] Tribunal required the petitioner to deposit 50% of the penalty amount in cash and to give bank guarantee for the balance 50%. We have gone through the order and have heard Mr. Arun Jaitley, Senior Advocate and we do not find any error in the impugned order for us to interfere. Dismissed.”
Sd/- Sd/-
July 4,1994 D.P. Wadhwa, J. Devinder Gupta, J.
The applicants now say that there has been subsequent deterioration in their financial position and requested for modification of the stay order. We have perused the Balance Sheet provisional as on 31-3-1994 of the firms M/s. N. Futehally & Co., M/s. Speedax and M/s. Ashiya Motors. On consideration of the amount of their current assets sides including Sales Revenue and Sundry Debtors, we are of the view having regards specially to the observation of the Tribunal already made in Para-20 of the stay order, that the pre-deposits in terms of cash as already ordered by the Tribunal need no modification. However, as regards the further direction to furnish Bank guarantee for equal amount, we are inclined in the circumstances now explained to make a modification in the level of Bank guarantee. We direct that the Bank guarantee be given to the extent of 25% instead of 50% as was ordered in the stay order of the Tribunal. The stay order by the Tribunal dated 4-3-1994 is modified only to this extent. We further grant time to the applicants for compliance with this modified stay order upto 28th March, 1995. To come up for ascertaining compliance on 7-4-1995.