Classification of deposit of duty, pending adjudication with the adjudicating authority under Section 35F of Central Excises and Salt Act, 1944 - Central Excise - 12/93-CX.6

Classification of deposit of duty, pending adjudication with the adjudicating authority under Section 35F of Central Excises and Salt Act, 1944 Circular No. 12/93-CX.6 Dated 23-8-1993 [From F.No. 208/54/92-CX.6] Government of India Central Board of Excise Customs New Delhi Subject : Classification of deposit of duty, pending adjudication with the adjudicating authority under Section 35F of Central Excises and Salt Act, 1944. This is to say that a question has been raised regarding classification of deposit of duty, under appropriate head, pending adjudication with the adjudicating authority under Section 35F of Central Excises and Salt Act, 1944. 2. Levy and collection of duty of Central Excise has been provided under Section 3 of the Central Excises and Salt Act, 1944 and Rules 9 and 173 of Central Excise Rules, 1944. The manner of accounting under Head of Accounts stands specified by the instructions issued from time to time. 3. However, there are certain other provisions in the Act and the Rules, which provide for 'deposit'. Under Section 35F it is stipulated that where in an appeal, the decision or the order appealed against relates to any duty demanded in respect of goods which are not under the control of Central Excise authorities or any penalty levied under the Act, the person desirous of appealing against such decision or order shall, pending the appeals, deposit with the adjudicating authority, the duty demanded or the penalty levied. 4. A question has been raised as to whether the deposit of the aforesaid nature is to be considered payment of duty and taken as a revenue receipt under the appropriate revenue head or is to be credited to a separate head provided for this purpose and later re-adjusted and taken as revenue receipt after the appeal stands decided. 5. It is now clarified, in consultation with the Chief Controller of Accounts, Central Board of Excise and Customs, that the right procedure is to classify such deposits under the final revenue head of account in the Government account from the initial stage itself. For this purpose, a reference can be made to Note (8) below para 95 of "BASIC MANUAL OF DEPARTMENTAL INSTRUCTIONS OF EXCISABLE MANUFACTURED PRODUCTS" which clarifies that Duty, Fine and Penalties etc. if collected even provisionally as deposits ab initio, pending adjudication, should be accounted for direct under the revenue head "0038-UNION EXCISE DUTIES". The Term "DEPOSIT WITH THE ADJUDICATING AUTHORITY" pending appeal/adjudication may be construed to mean "REMITTANCE OF DUTY". 6. Field formations and trade interests may be informed accoridngly.