Judgment

SABYASACHI MUKHARJI, J. : - These two appeals are under S. 130E(b) of the Customs Act, 1962 (hereinafter called the Act) from the orders passed by the Customs, Excise and Gold (Control) Appellate Tribunal (hereinafter called the CEGAT). The questions involved in these two appeals are identical. The appellants claim to be the citizens of India is not disputed. At the material time in 1983 they were based in Hong Kong and Singapore respectively.

2. In February, 1983, when the appellants came to India, they were charged with alleged offences under Ss. 112 and 114 of the Act and also simultaneously with the alleged offences under the Foreign Exchange Regulation Act, 1973 (hereinafter called the FERA). The Enforcement authorities recorded under S. 40 of the FERA the appellants statements at the time of their arrest. It is alleged that these statements were obtained under duress and by using third degree methods against them, who soon thereafter retracted their statements. No statement were, however, recorded by the Customs authorities under the corresponding S. 108 of the Act. In the FERA proceedings, the Enforcement Directorate, it is stated, applied that there was no evidence against the appellant - Vijay Prakash Mehta and the Directorate had no objection to his discharge. Accordingly, by an order dated 29-10-1985, of the Additional Chief Metropolitan Magistrate, 8th Court, Esplanade, Bombay, he was discharged and his bail-bond was cancelled.

3. So far as the appellant J. D. Mehta is concerned, he had replied to the show-cause notice issued by the Enforcement Directorate and the matter is pending adjudication. In the meantime, the proceedings under Ss. 111 to 114 and 118 of the Act resulted in the order dated 19-1-1984 of the Addl. Collector of Customs (Preventive) Bombay, whereby he imposed a penalty of Rs. 3,00,000/- on each of the appellants. It may be mentioned that each of the appellants was alleged to have been caught red-handed with the foreign exchange to the tune of Rs. 11,90,648/-. The appellants had admitted their part in the systematic illegal export of foreign exchange from India during the past several years. Against the said order dated 19-1-1984, the appellants preferred their repective appeals to the Appellate Tribunal under S. 129A of the Act. The Tribunal reduced the amount of penalty to be deposited, in an application made under S. 129E of the Act, pending hearing of the appeal, to Rs. 1 lakh for each of the appellants.

4. It is alleged that since neither of the appellants were in any financial position to deposit even Rs. 1 lakh, they sought further reduction. The Appellate Tribunal, after considering the facts and circumstances of the case and taking into consideration all the relevant material facts and factors, by its order dated 17th February, 1987, declined to do so and dismissed the appeals for non-compliance with the provisions of S. 129E of the Act. Aggrieved thereby the appellants have appealed to this Court. S. 129E of the Act provides as follows : -

"Where in any appeal under this Chapter, the decision or order appealed against relates to any duty demanded in respect of goods which are not under the control of the customs authorities or any penalty levied under this Act, the person desirous of appealing against such decision or order shall, pending the appeal, deposit with the proper officer the duty demanded or the penalty levied :

Provided that where in any particular case, the Collector (Appeals) or the Appellate Tribunal is of opinion that the deposit of duty demanded or penalty levied would cause undue hardship to such person, the Collector (Appeals) or, as the case may be, the Appellate Tribunal may dispense with such deposit subject to such conditions as he or it may deem fit to impose so as to safeguard the interests of revenue."

5. The aforesaid Section provides a conditional right of appeal in respect of an appeal against the duty demanded or penalty levied. Although the Section does no