By Puloma Dalal, Jayesh Gogri, Mandar Telang Chartered Accountants
fiogf49gjkf0d
The amendment to section 35F of the Central Excise Act, 1944 with effect from 06/08/2014 regarding mandatory pre-deposit is prospective in nature and shall not apply to assessment proceedings initiated prior to the said date.
Facts:
The Petitioner was seeking permission to file an appeal without mandatory deposit as the dispute pertains to the period prior to amendment of section 35F.
Held:
The Hon’ble High Court relying on the decision of the Kerala High Court in the case of Muthoot Finance Limited [2015-TIOL-632-HC-KERALA-ST] (refer BCAJ-April’s issue) held that the amended provisions of section 35F of the Central Excise Act, 1944 are not given retrospective effect. Since the proceedings were initiated prior to 06/08/2014, the Appeal and stay application could be filed before the CESTAT without making a pre-deposit. The High Court also noted the decision in the case of Deputy Commercial Tax Officer, Tirupur vs. Cameo Exports and others [2006 (147) STC 218 (Mad)] rendered in the matter of Tamil Nadu General Sales Tax Act, 1959 wherein it has been held that the right of appeal is vested in the assessee the moment he files his return which commences the assessment proceedings. Therefore since the amendment is not retrospective, appeals deserved to be entertained without insisting on pre deposit.
Note: A contrary decision of the Mumbai CESTAT in the case of Maneesh Export(EOU), Satish J. Khalap, Vinay R. Sapte vs. Commissioner of Central Excise, Belapur[2015-TIOL-1093- CESTAT-MUM] reported in the BCAJ-July 2015 issue holding that the amendment to section 35F of the Central Excise Act, 1944 is retrospective in nature.
