2014 (5) TMI 639 - HC - Central Excise

Waiver of pre deposit - Application under Section 35F - Whether the Tribunal would be competent to decide the appeal filed at the instance of the assessee without deciding first the application for waiver of deposit of the duty demanded or the penalty thereon - Held that - assessee has not filed any application for waiver at all at the time when the appeal was filed before the Commissioner of Central Excise (Appeals). In such event, the respondent/assessee could maintain the appeal only after the pre-deposit. The Commissioner (Appeals) should not have taken the appeal when the assessee has not made pre-deposit. All the more, the Commissioner (Appeals) has not taken notice of the fact that the assessee has not even filed an application seeking for waiver of pre-deposit so as to enable him to consider the request under the first proviso to Section 35F of the Act - pre-deposit is a condition precedent for filing an appeal before the Commissioner (Appeals) and the filing of application for waiver of such deposit is also a condition precedent, without either of the above, the appeal could not have been entertained by the Commissioner (Appeals). However, keeping the above principle in mind, the facts of the present case should be considered. as the assessee has already paid the entire amount and the Revenue has not raised the said point before the Commissioner (Appeals) and for the first time, it was raised before the CESTAT. We are, therefore, not inclined to interfere with the order of the CESTAT on the facts of the present case. - Decided against Revenue.

Summary

Issues:
Competence of Tribunal to decide appeal without deciding waiver application for deposit of duty or penalty.

Analysis:
The judgment revolves around the issue of whether the Tribunal can decide an appeal without first determining the application for waiver of deposit of duty or penalty. The case involved an appeal by the Revenue against an order passed by the Commissioner of Central Excise (Appeals) in favor of the assessee. The Revenue contended that the appeal should not have been entertained without considering the application for waiver of pre-deposit. The Central Excise Act, 1944, and Section 35F were crucial in determining the mandatory nature of pre-deposit. The provision of Section 35F mandates that the duty demanded or penalty levied should be deposited pending appeal, unless the Commissioner deems it would cause undue hardship to the person appealing. The Commissioner has the authority to dispense with the deposit under certain conditions to safeguard the interests of the Revenue.

The judgment emphasized that the pre-deposit is a prerequisite for filing an appeal, and if an assessee faces difficulty in making the deposit, an application for waiver must be submitted. The Commissioner has the power to grant or deny the waiver based on the circumstances. The judgment highlighted the importance of adhering strictly to statutory provisions, citing Supreme Court cases where failure to comply with statutory requirements led to specific consequences. It was established that when a statute prescribes a particular act in a specific manner, it must be strictly followed, especially in penal provisions. The judgment also touched upon the significance of filing a waiver application and the consequences of not doing so.

The judgment differentiated the present case from a previous ruling, stating that the Revenue had not contested the application for waiver in that instance, unlike in the current scenario. It was concluded that the appeal should not have been entertained without the pre-deposit, and the Commissioner should have considered the absence of a waiver application. However, considering that the assessee had already paid the entire amount demanded, the Tribunal's decision to reject the Revenue's contention was upheld. Ultimately, the question of law was answered against the Revenue based on the facts of the case, leading to the dismissal of the Civil Miscellaneous Appeal without costs.