By TIOL News Service

NEW DELHI, APRIL 30, 2018: THE appeal filed by the assessee was dismissed by the Commissioner (A) on the ground that the mandatory pre-deposit under section 35Fof the CEA, 1944 was deposited after three months of the passing of the adjudication order.

The lower appellate authority observed - As the reference of Section 35 (1) has been given in Section 35F of the CEA, it is clear that the said time limit is also applicable on the requirements of making pre-deposit of seven and half percent of duty as per Section 35F of the CEA. In other words, compliance of new Section 35F of the CEA is to be done within the time limits specified in Section 35(1) of the CEA i.e the Appellant should not only file the appeal within the time period stipulated under Section 35 (1) of the CEA but also is required to make pre-deposit of seven and half percent of duty within the said time period, so as to enable the Commissioner (Appeal) to entertain that appeal.

Unhappy with the dismissal of their appeal, the appellant is before the CESTAT and submits –

+ The Appellate Commissioner has wrongly applied the time limit of two months and additional one month for making pre-deposit on the ground that there is reference of section 35(1) of CEA in Section 35F.

+ That on careful reading of section 35F it is amply clear that the reference of Section 35(1) is given only for the purpose of specifying as to for which kind of appeals the present section would be applicable.

+ Under Section 35F there is no time limit to make pre-deposit but the Appellate Authority cannot entertain the appeal unless pre-deposit is made.

+ Section 35(1) only provides for filing of appeal within stipulated time before Commissioner (Appeals).

Inasmuch as since the Appeal was correctly filed before the Commissioner(A) within 60 days, there is no default under section 35(1) of the CEA, the appellant emphasised.

The AR justified the dismissal of the appeal by the lower appellate authority.

The Bench extracted both the referred sections viz. section 35 and section 35F of the CEA, 1944 and observed -

++ Both Sections are Independent and have got no overriding effect on the other. Section 35 (1) is in respect of type of appeal which can be filed before the Commissioner (Appeals) and it does not deal with entertaining appeal by Commissioner (Appeals).

++ Section 35F in turns deals only with the entertaining the appeal subject to condition of pre-deposit of seven and half percent. It nowhere prescribes the time limit for making pre-deposit and the provisions of Section 35 F cannot be read in context of Section 35 (1) as it has got no application. The non-payment of pre-deposit is curable defect. ++ Any appeal can be entertained only when it is filed. Obviously the question of entertaining the appeal comes at the time of filing of appeal which has to be filed within stipulated period.

++ Once the appeal has been filed within the time limit the same cannot be dismissed on the ground of late payment of pre-deposit amount.

The impugned order was set aside and the matter was remanded to the Commissioner (Appeals) to hear the case on merits and decide the appeal.

(See 2018-TIOL-1369-CESTAT-MUM)