2016 (8) TMI 251 - AT - Service Tax

Restoration of appeal non-compliance of section 35F of the Central Excise Act,1944 - stay application filed after statutory time limit tax, interest and penalties not paid Held that - the appellant did not file any stay application along with their appeal within the statutory period under Section 35F of the Central Excise Act, 1944. The Commissioner (Appeals) was correct in rejecting the letter-cum-stay application, which was submitted after one year and four months of the filing of the appeal and much beyond the statutory period laid down in the Central Excise Act. The only option left for the appellant in such a situation was to deposit the entire amount of tax with interest and penalties before filing of the appeal, as the appellant had not sought waiver of pre-deposit The Commissioner (Appeals) has therefore rightly rejected the appeal for non-compliance of Section 35F decided against the appellant.

Summary

Issues:
1. Compliance with Section 35F of the Central Excise Act, 1944 for filing an appeal.
2. Entertaining appeal without a stay application.
3. Timeliness of filing a stay application.
4. Pre-deposit requirements under Section 35F.
5. Applicability of statutory provisions for pre-deposit.

Analysis:

1. The main issue in this appeal was whether the dismissal of the appellant's appeal by the Commissioner (Appeals) for non-compliance was lawful. The appellant had been issued a show cause notice for service tax non-payment and penalties. The Commissioner (Appeals) dismissed the appeal as no stay application was filed along with it, leading to non-compliance with Section 35F of the Central Excise Act, 1944.

2. The appellant argued that a stay application was submitted before the Commissioner (Appeals) passed the order, requesting waiver of the service tax demand and penalties. However, the department contended that the stay request was filed after the statutory period of three months, making it untimely. The Commissioner (Appeals) rightly dismissed the appeal for non-compliance.

3. The Tribunal observed that the appellant failed to file a stay application within the statutory period, leading to the rejection of the letter-cum-stay application submitted after one year and four months of filing the appeal. The Commissioner (Appeals) was correct in rejecting the late stay application, as the appellant did not seek waiver of pre-deposit as required by law.

4. The Tribunal highlighted that the appellant's argument of paying more than 10% of the disputed tax amount was not valid since the appeal was filed before the statutory provisions for pre-deposit of 7.5% and 10% were introduced. Therefore, the provisions did not apply to the appellant's case, and the appeal was rightly dismissed for non-compliance with Section 35F.

5. Ultimately, the Tribunal upheld the dismissal of the appeal, emphasizing that the appellant had not complied with the pre-deposit requirements under Section 35F of the Central Excise Act, 1944. The decision was based on legal precedents, including the case law of Navin Chandra Chhotelal vs. Central Board of Excise & Customs, supporting the rejection of appeals for non-compliance with statutory deposit requirements.

In conclusion, the Tribunal dismissed the appeal due to the appellant's failure to comply with the pre-deposit requirements under Section 35F, emphasizing the importance of timely submission of stay applications and adherence to statutory provisions for appeals in tax matters.