2021 (1) TMI 928 - HC - Service Tax

Stay of pre-deposit - seeking direction to the 1st respondent to entertain the appeal filed by the petitioner without insisting on further pre-deposit of amount - delay in filing of appeal before the Commissioner (appeals) - HELD THAT - Though there is appear to be a deficit in pre-deposit of amount in so as far as the Order in Original No.14/2017 is concerned as the report filed, it is noticed that the petitioner has paid amounts in excess in their appeal against the order in Original Nos.15 16/2017 for a sum of ₹ 74,825/- and ₹ 85,479/-. Thus, there is excess payment of ₹ 1,60,304/- by the petitioner which amount can be allowed to be adjusted against the amount of pre-deposit in the petitioner's appeal against Order in Original No.14/2017 dated 10.2.2017 - The impugned communication dated 03.05.2017 also states that the appeal has been filed with a delay of one day. However, there is no explanation forthcoming from the petitioner on the same. The petitioner is given liberty to file appropriate applications for condoning the delay or in the alternative, give their explanation as to why there was no delay in filing the appeals and how the amounts paid by the petitioner in appeal against the Order in Original No.14 of 2017 was in excess of 7.5% required to be pre-deposited under Section 35 F of the Central Excise Act, 1944 for entertaining the aforesaid appeal - In case, the office of the 1st respondent still finds there was deficit in the pre-deposit amount by petitioner against its appeal against the Order in Original No.14 of 2017- dated 10.02.2017, the petitioner shall be informed about the same in writing consequent to which the petitioner shall deposit the deficit amount within a period of one week from the date of receipt of such communication from the office of the 1st respondent - On such deposit, the appeals shall be numbered forthwith subject to formal order for condoning the delay if such application is required and dispose the appeals within a period of three months thereafter. Petition allowed.

Summary

Issues:
1. Challenge to communication for further pre-deposit in appeal
2. Compliance with pre-deposit requirements under Section 35 F of the Central Excise Act, 1944
3. Excess payments made by the petitioner
4. Delay in filing the appeal
5. Adjustment of excess amounts against pre-deposit requirements
6. Liberty granted to file applications for condonation of delay or explanations

Issue 1: Challenge to communication for further pre-deposit in appeal
The petitioner filed a writ petition to quash a communication dated 3.5.2017 requiring a further pre-deposit of 7.5% of the impugned service tax/penalty for the appeal to be entertained. The petitioner claimed to have deposited amounts in excess of 7.5% and questioned the justification of the communication.

Issue 2: Compliance with pre-deposit requirements under Section 35 F of the Central Excise Act, 1944
A report filed by the Superintendent (Legal) indicated that the petitioner had complied with the pre-deposit requirements for some orders but had a deficit of ?1,57,574 in one specific order. The respondent stated that if the deficit amount was paid, all appeals would be numbered and taken up for final hearing.

Issue 3: Excess payments made by the petitioner
The petitioner had made excess payments in appeals against certain orders, amounting to ?74,825 and ?85,479. This excess amount was proposed to be adjusted against the pre-deposit requirement in the appeal against a specific order.

Issue 4: Delay in filing the appeal
The communication highlighted a delay of one day in filing the appeal, for which no explanation was provided by the petitioner. The petitioner was given liberty to file applications for condoning the delay or provide an explanation for the delay.

Issue 5: Adjustment of excess amounts against pre-deposit requirements
The excess payment made by the petitioner in certain appeals was proposed to be adjusted against the deficit in the pre-deposit for a specific order, resulting in an excess payment of ?1,60,304 by the petitioner.

Issue 6: Liberty granted to file applications for condonation of delay or explanations
The petitioner was granted four weeks to file applications or representations regarding the delay in filing the appeal and the excess payments made. The office of the respondent was directed to consider these applications and determine if there was still a deficit in the pre-deposit amount, with instructions for further action accordingly.

In conclusion, the writ petition was allowed with observations, granting liberty to the petitioner to address the issues raised and ensuring the appeals would be numbered and disposed of within a specified timeframe.