2023 (8) TMI 990 - AT - Central Excise

Maintainability of appeal - appeal dismissed for the reason of delay in making the pre-deposit - HELD THAT - In the present case, Commissioner (Appeals) as on very frivolous ground that of pre-deposit as made subsequent filing of the appeal dismissed this appeal and which cannot be justified in the manner because on the date of consideration of the appeal pre-deposit was already made. From the perusal of section 35F it is quite evident that the Commissioner (Appeal) or Tribunal is barred from entertaining any appeal before the conditions as imposed by the section 35F are complied with. This section do not put any bar on filing of the appeal or state that appeal could not have been filed till the pre-deposit has been made. The bar has been imposed on the consideration of appeal by the Commissioner (Appeal) or the Tribunal. Thus when the appeal is to be taken up for consideration by the concerned appellate authority he is required to satisfy himself that the conditions of Section 35F are complied with. Thus if the pre-deposit is made at any time before the consideration of the appeal by the concerned authority, then the conditions of Section 35F are satisfied and the said authority is within his right to consider the appeal and make orders as deemed fit. Also, it is evident that In the present case on the date of consideration of the appeal the requirements of 35F have been complied with, thus order of Commissioner (Appeal) dismissing the appeal for this reason is result of improper appreciation of the phrase entertain the appeal , used in the Section 35, ibid. There are no merits in the impugned order and set aside the same. Taking note of the pre-deposit made as recorded in para 6 of the impugned order, it is directed that the Commissioner (Appeals) to hear the appellant on merits and pass a well speaking reasoned order. Matter remanded back to Commissioner (Appeal) for decision on merits within the three months from the date of receipt of this order.

Summary

Issues involved:
The issues involved in the judgment are related to the dismissal of an appeal due to delay in making the mandatory pre-deposit as required by Section 35F of the Central Excise Act, 1944.

Issue 1: Delay in making pre-deposit
The Commissioner (Appeals) dismissed the appeal due to delay in making the mandatory pre-deposit of seven and a half per cent of the duty demanded or penalty imposed, as required by Section 35F of the Central Excise Act. The appellant had filed the appeal on 11.10.2019 but made the pre-deposit on 12.12.2019, two months after filing the appeal. The Commissioner (Appeals) held that the appeal could not be entertained without the pre-deposit being made before filing the appeal, as mandated by the statute. However, the appellant argued that the pre-deposit was made before the appeal was considered, and therefore, the appeal should not have been dismissed solely on the grounds of delay in pre-deposit.

Decision and Rationale:
The Hon'ble High Court of Orissa's decision in a similar case highlighted that the right to file an appeal is subject to conditions, as provided by Section 35F of the Central Excise Act. The court emphasized that the pre-deposit is required for the "entertainment of appeal" and not for the "filing of appeal." The court clarified that the statute does not bar a party from filing an appeal unless the required amounts are deposited. Therefore, as long as the appeal is pending, the party can deposit the necessary amount. The judgment set aside the Commissioner (Appeals)'s decision and directed a reconsideration of the appeal on its merits, emphasizing the importance of a well-reasoned order.

Conclusion:
The judgment concluded by allowing the appeal and remanding the matter back to the Commissioner (Appeal) for a decision on merits within three months from the date of the order. The judgment highlighted the distinction between the pre-deposit requirement for the "entertainment of appeal" and the timing of the deposit in relation to the filing and consideration of the appeal.