2016 (12) TMI 1512 - AT - Central Excise

Pre-deposit - Section 35F of the Central Excise Act,1944 - interpretation of statute - Held that - I find that the wordings employed therein are as clear as daylight. In clause (iii) it is unambiguously prescribed that any person aggrieved by a decision or order referred to Clause (b) of sub- Section (1) of Sec. 35B of Central Excise Act, unless deposits 10% of the duty/penalty or duty and penalty, as the case may be, the appeal shall not be entertained. I do not find any reason to read the said provision in any other manner, so as to come to the conclusion that the Appellant is required to deposit 2.5% and not 10% as prescribed under the said provision, in view of the settled principle of statutory interpretation. Appeal dismissed - decided against appellant.

Summary

Issues: Interpretation of Section 35F of the Central Excise Act, 1944 regarding the deposit required for filing an appeal.

Analysis:
The appeal in question was filed against an order passed by the Commissioner of Central Excise (Appeals) - RAJKOT. The main contention revolved around the interpretation of Section 35F of the Central Excise Act, 1944, specifically focusing on the deposit required for entertaining an appeal. The appellant argued that since they had already deposited 7.5% at the first appellate stage, they should only be required to deposit the remaining 2.5% and not the entire 10% as mandated by the provision. On the contrary, the Revenue representative argued against such an interpretation, emphasizing the literal reading of the statute without inserting additional words. The relevant provision of Section 35F mandates the deposit of a certain percentage of duty demanded or penalty imposed before filing an appeal, with specific percentages outlined for different scenarios.

Upon a thorough examination of the statutory provision in question, the presiding Member found the language to be clear and unambiguous. It was noted that Clause (iii) of Section 35F explicitly requires the appellant to deposit 10% of the duty/penalty or duty and penalty to entertain the appeal in cases falling under Clause (b) of sub-Section (1) of Sec. 35B of the Central Excise Act. The Member highlighted the settled principle of statutory interpretation, emphasizing the need to adhere to a literal interpretation, especially in taxing statutes. Reference was made to a judgment by the Honorable Bombay High Court, underscoring the importance of interpreting taxing statutes strictly without introducing extraneous elements or resorting to equitable considerations.

In light of the above analysis and legal principles, the Member dismissed the argument that the amount previously deposited under Clause (i) of Sec. 35F could be adjusted against the deposit required under Clause (iii) for filing the appeal before the appellate forum. Consequently, the appeal was not entertained based on the statutory requirement of depositing 10% as stipulated under Section 35F. The judgment underscores the significance of adhering to the literal language of taxing statutes and the limitations on introducing equitable considerations in such interpretations.