2019 (2) TMI 442 - AT - Service Tax

Maintainability of appeal - non-compliance with the pre-deposit - section 35F of Central Excise Act, 1944 - time limitation of filing appeal - section 35(1) of Central Excise Act, 1944 - Held that - Filing an appeal, indicating the limitation therein, is provided for in section 35(1) of Central Excise Act, 1944. Beyond that threshold, the sufficiency of an appeal will determine its maintainability for being entertained. Hence, the appeal, having been filed on 14th November 2014, is within the condonable period. The change in law mandating pre-deposit come into place on 6th August, 2014 and, with that change, orders should have included that information in the preamble to enable appellant to comply. This is absent in the impugned order and it was only by communication dated 9th December 2014 that the appellant was made aware of the deficiency which was made good by them - Upon the matter being taken up for disposal on 30th December, 2014, the requirement of predeposit had been complied with and the first appellate authority, even in the absence of the appellant, should have disposed off the matter on merit. Matter remanded back to the first appellate authority for a proper disposal - appeal allowed by way of remand.

Summary

Issues:
Non-compliance with section 35F of Central Excise Act, 1944 in appeal against order-in-appeal, interpretation of 'entertain' in section 35F, sufficiency of appeal for maintainability, change in law mandating pre-deposit, disposal of appeal on merit.

Analysis:

The judgment by the Appellate Tribunal CESTAT MUMBAI involved a case where the impugned order did not entertain the challenge of the appellant on merit due to non-compliance with the provisions of section 35F of the Central Excise Act, 1944. The appellant failed to make the mandatory pre-deposit as required by the amended section 35F, which led to notices of rejection being issued. Despite the appellant depositing the prescribed amount, the first appellate authority held that the appeal should have been filed earlier, before the effective date specified. However, the Tribunal disagreed with this interpretation, stating that the appeal was filed within the condonable period as per section 35(1) of the Act.

Regarding the interpretation of 'entertain' in section 35F, the Tribunal noted that the sufficiency of an appeal, beyond the filing period, determines its maintainability for being entertained. The change in law mandating pre-deposit came into effect on 6th August 2014, but the appellant was not informed of this change in the impugned order. It was only through a later communication that the appellant became aware of the deficiency and rectified it. The Tribunal emphasized that the first appellate authority should have disposed of the matter on merit once the pre-deposit requirement was met, even in the absence of the appellant.

In conclusion, the Tribunal set aside the impugned order and remitted the matter back to the first appellate authority for proper disposal. The appellant was to be given a sufficient opportunity to be heard in the process. The judgment highlighted the importance of complying with procedural requirements while also ensuring that appellants are informed of any changes in the law affecting their cases for a fair adjudication.