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2016 (6) TMI 472 - HC - Service TaxConstitutional validity of Section 35F of the Central Excise Act 1944 - Minimum requirement of pre-deposit of 7.5% to file an appeal - Held that - the Petitioner cannot afford the pre-deposit that might be ordered by the CESTAT the Court finds the plea to be premature since there has been no occasion for the CESTAT to yet pass any order of pre-deposit. As already noticed the CESTAT declined to hear the Petitioner s appeal only because the Petitioner has instituted parallel proceedings in this Court by way of the present petition challenging inter alia the adjudication order dated 21st April 2014. The Petitioner cannot be allowed to bypass the statutory remedy available to it. The right course is for the Petitioner to revive/seek restoration of its appeal before the CESTAT accompanied by an application for condonation of delay in filing such restoration application seeking recall of the CESTAT s order dated 21st August 2015. The question of the Court in the present petition interfering with the show cause notices which led to passing of the above adjudication order also does not arise. The question whether the amended Section 35 F of the CE Act will apply to the Petitioner s appeal will be decided by the CESTAT in accordance with law. It will be open to the Petitioner if it files the restoration application in the CESTAT not later than ten days from today along with an application for condonation of delay to urge that the Petitioner was bonafide pursuing the present petition and that this factor should be taken into account while considering the prayer for condonation of delay in filing the restoration application. - Petition disposed of
Issues:
Challenge to impugned adjudication order confirming service tax demand; Maintainability of appeal before CESTAT and parallel writ petition; Petitioner's plea regarding pre-deposit under Section 35-F of CE Act; Prayer to declare Section 35-F ultra vires; Court's stance on constitutional validity; Petitioner's affordability of pre-deposit; Court's view on statutory remedies and bypassing CESTAT; Restoration of appeal before CESTAT; Application for condonation of delay; Decision on applicability of amended Section 35-F by CESTAT. Analysis: The judgment involves a private limited company challenging an adjudication order confirming a service tax demand. The company filed a writ petition against the impugned order, raising concerns about the mandatory pre-deposit requirement under Section 35-F of the Central Excise Act, 1944. The company sought various reliefs, including a declaration of Section 35-F as ultra vires and setting aside the impugned order and show cause notices. The Court addressed the company's plea regarding the pre-deposit, emphasizing that the issue of affordability was premature as the CESTAT had not yet passed any order on the matter. The Court highlighted previous decisions where challenges to the constitutional validity of Section 35-F were declined, citing specific cases for reference. The Court also noted that the company cannot bypass the statutory remedy available through the CESTAT and instructed the company to revive its appeal before the tribunal. Regarding the restoration of the appeal before CESTAT, the Court directed the company to file a restoration application within a specified timeline and seek condonation of delay. The decision on the applicability of the amended Section 35-F to the company's appeal was left to the CESTAT to determine in accordance with the law. The judgment concluded by disposing of the writ petition and application based on the outlined terms, emphasizing the importance of following statutory procedures and seeking remedies through the appropriate channels.
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