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2018 (2) TMI 13 - AT - Central ExciseCompliance with mandatory pre-deposit - section 35F of the Central Excise Act - Held that - compliance of mandatory predeposit stands settled by the decision of the Hon ble Madras High Court in the case of Dream Castle Vs. Union of India 2016 (5) TMI 672 - MADRAS HIGH COURT , where it was held that even the substantive provision of Section 35-F, after its amendment, is not capable of any other interpretation. Our conclusions on the first contention was not on the basis of the second proviso. Therefore, we need not even find out whether the second proviso is exhaustive about the exclusions, or whether the second proviso is a substantive provision in itself or the extent to which the second proviso would control the substantive provision - the appellant has to comply with the mandatory predeposit. Appeal dismissed - decided against appellant.
Issues Involved:
1. Non-compliance with mandatory pre-deposit under Section 35F of the Central Excise Act. 2. Financial hardship and closure of the appellant's company. 3. Legal precedents and interpretation of the amended Section 35F. 4. Retrospective application of the amended Section 35F. 5. Judicial discretion in waiver of pre-deposit. Issue-wise Detailed Analysis: 1. Non-compliance with Mandatory Pre-deposit under Section 35F: The appellant did not comply with the mandatory pre-deposit requirement under Section 35F of the Central Excise Act. The Tribunal emphasized the necessity of this compliance, referencing the Hon'ble Madras High Court's decision in Dream Castle Vs. Union of India, which upheld the mandatory nature of the pre-deposit requirement for appeals filed after the amendment came into force. 2. Financial Hardship and Closure of the Appellant's Company: The appellant's counsel argued that the company had been closed since 29.12.2012, with liabilities exceeding ?200 crores, including dues to banks and employees. The appellant requested a waiver of the pre-deposit, citing the attachment of their land valued at ?110 crores by Central Excise authorities. Despite these arguments, the Tribunal did not find sufficient grounds to waive the mandatory pre-deposit. 3. Legal Precedents and Interpretation of the Amended Section 35F: The Tribunal reviewed multiple legal precedents to interpret the amended Section 35F. Key cases included: - Dream Castle Vs. Union of India: Affirmed the mandatory pre-deposit requirement. - R. Rajagopal Reddy v. Padmini Chandrasekharan: Discussed the non-retrospective application of statutory provisions affecting vested rights. - The Deputy Commercial Tax Officer v. Cameo Exports: Addressed the substantive right of appeal and the effect of amendments on such rights. - Ganesh Yadav v. Union of India: Upheld the constitutional validity of the amended Section 35F, emphasizing that the right of appeal is a statutory right subject to legislative conditions. 4. Retrospective Application of the Amended Section 35F: The Tribunal examined whether the amended Section 35F applied retrospectively. The consensus from various High Court decisions, including the Allahabad and Gujarat High Courts, was that the amendment applied to all appeals filed after its enforcement date (6 August 2014). The Tribunal concurred, noting that the amendment did not take away a vested right but merely replaced a discretionary waiver with a fixed pre-deposit requirement. 5. Judicial Discretion in Waiver of Pre-deposit: The Tribunal discussed the implications of judicial discretion in waiving pre-deposit conditions. The amendment to Section 35F aimed to standardize the pre-deposit requirement, thus reducing arbitrary decisions and ensuring uniform application. The Tribunal noted that this change was beneficial as it removed the uncertainty and potential for inconsistent waiver decisions by appellate authorities. Conclusion: The Tribunal concluded that the appellant must comply with the mandatory pre-deposit requirement. The appeal was dismissed due to non-compliance, following the precedent set by the Hon'ble Madras High Court and other relevant judicial decisions. The Tribunal emphasized that the amended Section 35F applied to all appeals filed after its enforcement date, and the appellant's financial hardship did not justify a waiver of the mandatory pre-deposit.
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