Mandatory Pre-Deposit Can’t Be Waived or Adjusted Against Company’s Duty Payment for CESTAT Appeal: Calcutta High Court

The Calcutta High Court has dismissed a writ petition challenging the refusal of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata, to entertain an appeal for non-compliance with the statutory pre-deposit requirement. The bench of Justice Om Narayan Rai observed that the petitioner cannot seek indirectly what had earlier been denied directly by a Division Bench—relaxation of the mandatory pre-deposit condition for filing a statutory appeal. The controversy traces back to an Order-in-Original passed against the petitioner, his brother, and M/s. Beriwala Impex Private Limited under the Customs Act, 1962. The petitioner initially challenged the adjudication order before the High Court in 2014, alleging violation of natural justice. However, the writ petition was dismissed in 2016. The Court found that the petitioner had made a voluntary statement under Section 108 of the Customs Act and had been duly served with the show cause notice. It concluded that the petitioner was aware of the proceedings but chose not to participate. The Court also observed that an alternative statutory remedy of appeal was available under Section 129E of the Customs Act. The dismissal was affirmed by a Division Bench in 2019. The Bench categorically held that the requirement of statutory pre-deposit cannot be bypassed merely because the penalty amount is high, reiterating that “an appeal is a creature of statute” and any condition attached to it must be fulfilled. Following the appellate order, the petitioner filed an appeal before CESTAT in 2020 but did not deposit the required statutory pre-deposit. The penalties imposed reportedly amounted to approximately ₹23 crore on each appellant. CESTAT noted that under Section 35F (as applicable), there is no scope for leniency, and appellants must deposit 7.5% or 10% of the disputed amount as a pre-condition to maintain an appeal. Since the petitioner failed to comply even after four years, the Tribunal dismissed the appeal at the threshold. The petitioner contended that M/s. Beriwala Impex Private Limited had separately challenged the same Order-in-Original before CESTAT and had initially secured relief in 2022, with the Tribunal holding that the proceedings against the company were without jurisdiction. However, the Revenue carried the matter to the Supreme Court of India, and the dispute was ultimately remanded to CESTAT for fresh consideration. The petitioner argued that since the company’s appeal is pending upon remand, the present writ petition should be kept pending. As the company has already paid the entire duty demanded under the Order-in-Original, the petitioner’s statutory pre-deposit liability should be adjusted or reduced accordingly. The High Court held that the Division Bench had already rejected the plea for relaxation of the statutory pre-deposit. The petitioner, having accepted that order and approached CESTAT, cannot revive the same argument through another writ petition after failing to comply with the statutory condition. The Court noted that there was no material change in circumstances since the Division Bench’s decision. The petitioner remained in the same position as before. Crucially, the Court held that there is no provision under the Customs Act permitting adjustment or appropriation of duty paid by one party toward another person’s statutory pre-deposit obligation. The liabilities of the company and the petitioner were separate and distinct under the Order-in-Original. The Court further observed that imposition of penalty and payment of duty are legally distinct aspects, and the petitioner cannot take advantage of the company’s payment to reduce his own statutory obligation. The Court emphasized that the petitioner cannot be allowed to “do indirectly what he was disallowed to do directly” by challenging the adjudication order through a writ petition instead of complying with statutory appeal conditions. While dismissing the writ petition, the Court clarified that the petitioner is not barred from approaching CESTAT again with an application for condonation of delay, and a request for restoration of the appeal, provided he deposits the requisite statutory pre-deposit in accordance with law. If such an application is filed, CESTAT would be free to consider it on merits. Case Details Case Title: Naveen Goel Vs CESTAT Case No.: WPO/161/2025 Date: 10/02/2026 Counsel For Petitioner: Mr. Rishi Raju, Adv. Counsel For Respondent: Manasi Mukherjee, Adv. Click Here To Read Order Read More: Misdeclared Afghan Origin Walnuts to Claim SAFTA Zero Duty: Customs Detains 310 Dry Fruit Containers at Nhava Sheva

Mandatory Pre-Deposit Can’t Be Waived or Adjusted Against Company’s Duty Payment for CESTAT Appeal: Calcutta High Court

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Mandatory Pre-Deposit Can’t Be Waived or Adjusted Against Company’s Duty Payment for CESTAT Appeal: Calcutta High Court

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