2015 (9) TMI 568 - AT - Central Excise

Utilization of Cenvat Credit for making deposit of 7.5%3 u/s 5F of the Central Excise Act, 1944 as pre-deposit before filling of appeal - Department claims that the disputed is related to cenvat credit itself and the action of the assessee is amount to reversal of the credit and not the payment of 7.5% amount - Held that - the said amounts have not been reversed during the course of investigation but were paid by the appellant themselves and are a matter of dispute with reference to the duty demand confirmed. We also agree with the contention of the learned Commissioner (AR) that considering these amounts at this stage will amount to going into the merits of the case, particularly as these are points of grievance of the appellant. In view of above analysis, in our view, the appellant is required to deposit 7.5% of the duty demanded and since they have not paid the said amount, the appeal is not maintainable. - However, in the interest of justice, we give two week s time to the appellant to deposit the same and report compliance on 10th August 2015.

Summary

Issues:
- Maintainability of the appeal under Section 35F of the Central Excise Act, 1944

Analysis:
1. Maintainability of the Appeal: The case was brought before the Bench to determine the maintainability of the appeal as per Section 35F of the Central Excise Act, 1944. The appellant contended that they had reversed certain cenvat credit amounts during specific periods and had paid a substantial sum. The appellant argued that they had complied with the provisions of Section 35F by considering the payments made during investigations as clarified by a circular from the Board. However, the Commissioner (AR) disputed the payments made by the appellant, stating that they were a matter of dispute and not related to the investigation. The Commissioner confirmed a duty demand amount, requiring the appellant to deposit 7.5% of the same. The Tribunal examined Section 35F, which mandates the deposit of a percentage of the duty demanded before filing an appeal. The circular clarified that payments made during investigations could be considered as deposits towards fulfilling the stipulations of Section 35F. However, the Tribunal noted that the appellant's payments were not reversed during the investigation but were made independently, leading to a dispute regarding the duty demand confirmed.

2. Decision and Ruling: The Tribunal concurred with the Commissioner (AR) that considering the disputed amounts at this stage would delve into the merits of the case, which should be addressed during the appeal proceedings. Consequently, the Tribunal ruled that the appellant was obligated to deposit 7.5% of the duty demanded to maintain the appeal. As the appellant had not fulfilled this requirement, the appeal was deemed not maintainable. However, the Tribunal allowed the appellant a two-week extension to deposit the required amount and instructed them to report compliance by a specified date. This decision aimed to uphold the procedural requirements while ensuring fairness and adherence to the statutory provisions.

3. Conclusion: The judgment focused on the interpretation and application of Section 35F of the Central Excise Act concerning the deposit requirements for maintaining an appeal. It emphasized the significance of complying with statutory provisions while acknowledging the nuances of payments made during investigations and their relevance to the appeal process. By providing a detailed analysis and ruling on the maintainability of the appeal in light of the deposit requirements, the Tribunal aimed to ensure procedural adherence and fairness in the legal proceedings.