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TMI ID= 267523
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  • Cases Cited

2015 (11) TMI 332 - CESTAT NEW DELHI

M/s Sahwney Coal Transport Pvt Ltd, M/s V.S. Coal Carriers Pvt Ltd, M/s Swastik Coal Carrier Pvt Ltd, M/s Arjuna Carriers Pvt Ltd, M/s Nirpendra Logistics Pvt Ltd Versus Commissioner of Central Excise And Service Tax, Jaipur-I

Waiver of pre deposit - whether pre-deposit of 7.5% of the impugned service tax liability in terms of Section 35F (as amended w.e.f. 06.08.2014 of the Central Excise Act 1944 read with Section 83 of the Finance Act, 1994 is required to be made while filing appeals against order-in-original dated 30.09.2014 when the Show Cause notice in respect thereof was issued before 06.08.2014 - Held that:- Allahabad High Court after inter alia considering the judgements of Kerala High Court in the case of Muthoot Finance Ltd. Vs. Union of India & Ors [2015 (3) TMI 634 -Kerala High Court] and Andhra Pradesh High Court in the case of K Rama Mohanarao Vs. Union of India (2015 (4) TMI 813 - ANDHRA PRADESH HIGH COURT) and the judgement of Supreme Court in the case of Hoosein Kasam Dada (India) Ltd. (supra) came to a clear finding that mandatory pre-deposit is required to be made in respect of the appeals filed on or after 06.08.2014.

Defect memos requiring the appellants to make pre-deposit in terms of Section 35F of the Central Excise Act, 1944 (as amended with effect from 06.08.2014) read with Section 83 of the Finance Act, 1994 is upheld - Decided against assessee.

No.- Diary Numbers- 52254, 52258, 52262, 52272 & 52293/2015

Dated.- September 15, 2015

Citations:

  1. Pradip J. Mehta Versus Commissioner of Income Tax, Ahmedabad - 2008 (4) TMI 6 - Supreme Court

  2. SNEH ENTERPRISES Versus COMMISSIONER OF CUSTOMS, NEW DELHI - 2006 (9) TMI 179 - SUPREME COURT OF INDIA

  3. Hoosein Kasam Dada (India) Ltd. Versus The State of Madhya Pradesh and Others - 1953 (2) TMI 35 - SUPREME COURT OF INDIA

  4. M/s. Ganesh Yadav Versus Union of India And 3 Others - 2015 (7) TMI 304 - ALLAHABAD HIGH COURT

  5. M/s. A.M. MOTORS Versus UNION OF INDIA AND COMMISSIONER OF CENTRAL EXCISE, KOZHIKODE - 2015 (6) TMI 162 - KERALA HIGH COURT

  6. M/s Muthoot Finance Ltd. Versus Union of India And Others - 2015 (3) TMI 634 - KERALA HIGH COURT

  7. M/s K RAMA MOHANARAO & CO Versus UNION OF INDIA, MINISTRY OF FINANCE, NEW DELHI AND OTHERS - 2015 (4) TMI 813 - ANDHRA PRADESH HIGH COURT

G Raghuram, President And R K Singh, Member (T)

For the Appellant : Shri A K Batra, CA

For the Respondent : Shri Rajeev Tandaon, DR

ORDER

Per R K Singh

The only issue involved in the matter is whether pre-deposit of 7.5% of the impugned service tax liability in terms of Section 35F (as amended w.e.f. 06.08.2014 of the Central Excise Act 1944 read with Section 83 of the Finance Act, 1994 is required to be made while filing appeals against order-in-original dated 30.09.2014 when the Show Cause notice in respect thereof was issued before 06.08.2014.

2. The appellant has contended that (i) as per the Kerala High Court judgment in the case of Muthoot Finance Ltd. Vs. Union of India & Ors. [2015 (3) TMI 634 (Ker.-HC)] and in the case of M/s A.M. Motors Vs. Union of India and Commissioner of Central Excise, Kozhikode [2015 (6) TMI-162-Kerala-High Court] , mandatory pre-deposit is not required because lis in question commenced prior to the introduction of the amended Section 35F ibid and therefore the appeal should be dealt with in terms of the provisions of Section 35F as existed prior to 06.08.2014, (ii) Vide the judgements of Kerala High Court in the case of Muthoot Finance Ltd. Vs. Union of India & Ors [2015 (3) TMI 634 (Ker.-HC)] and Andhra Pradesh High Court in the case of K Rama Mohanarao Vs. Union of India - 2015-TIOL-511-HC-AP-CX relief was granted from the requirement of payment of mandatory pre-deposit. It cited the judgement of the Supreme Court in the case of Pradip J. Mehta Vs. CIT, Ahmedabad [2008 (4) TMI 6 SC] to argue that when two interpretations are possible the court ordinarily would interpret the provisions in favour of tax-payer and contended that in the wake of judgements of Kerala and Andhra Pradesh High Courts, it is obvious that two interpretations are possible in this case, (iii) The Supreme Court judgement in the case of Hoosein Kasam Dada (India) Ltd. Vs. State of Madhya Pradesh [AIR 1953 SCC 211]  also supports its case.

3. Ld. Departmental Representative, on the other hand, stated that the issue stands settled by a detailed judgement by Allahabad High Court in the case of M/s. Ganesh Yadav Vs. Union of India & Others - 2015-TIOL-1490-HC-ALL-ST and added that the decisions of Kerala and Andhra Pradesh High Courts do not lay down any ratio with regard to non-applicability of Section 35F (as amended with effect from 06.08.2014) to the appeal filed on or after 06.08.2014 where the Show Cause Notice was issued prior to 06.08.2014.

4. We have considered the contentions of both sides. We find that the issue regarding requirement of mandatory pre-deposit in respect of the appeals filed on or after 06.08.2014 has been settled by CESTAT in the case of MTNL Vs. CST, Delhi vide its dated 08.06.2016, wherein it has been held that such appeals are required to be accompanied with mandatory pre-deposit as per the amended Section 35F ibid. In the said order, the judgements of Kerala and Andhra Pradesh High Courts and the judgement of Supreme Court in the case of Hoosein Kasam Dada (India) Ltd. Vs. State of Madhya Pradesh (supra) cited by the appellant were duly taken note of while arriving at the decision contained therein.

5. As regards the contention that in the wake of the judgements of Kerala and Andhra Pradesh High Courts cited above, two interpretations with regard to the requirement of mandatory pre-deposit in terms of Section 35F (as amended with effect from 06.08.2014) are possible and therefore in view of the Supreme Court judgement in the case of Pradip J. Mehta Vs. CIT, Ahmedabad (supra) the one favourable to the appellant should be applied, it is pertinent to mention that the Supreme Court in the case of Pradip J. Mehta Vs. CIT, Ahmedabad (supra) observed as under:-

"27. It is well settled that when two interpretations are possible, then invariably, the Court would adopt the interpretation which is in favour of the tax payer and against the Revenue, Reference may be made to the decision in Sneh Enterprises v. Commissioner of Customs, New Delhi [(2006) 7 SCO 714] of this Court wherein, inter alia, it was observed as under:

"While dealing with a taxing provision, the principle of "Strict Interpretation" should be applied. The Court shall not interpret the statutory provision In such a manner which would create an additional fiscal burden on a person. It would never be done by invoking the provisions of another Act, which are not attracted. It is also trite that while two interpretations are possible, the Court ordinarily would interpret the provisions in favour of a tax-payer and against the Revenue"."

It is evident from the above, that the observations of the Supreme Court were with regard to taxing provisions of a statute. The issue in the present case is not relating to taxing provisions of the Finance Act, 1994 and therefore that judgement does not come to the rescue of the appellant.

6. We find that Allahabad High Court after inter alia considering the judgements of Kerala High Court in the case of Muthoot Finance Ltd. Vs. Union of India & Ors (supra) and Andhra Pradesh High Court in the case of K Rama Mohanarao Vs. Union of India (supra) and the judgement of Supreme Court in the case of Hoosein Kasam Dada (India) Ltd. (supra) came to a clear finding that mandatory pre-deposit is required to be made in respect of the appeals filed on or after 06.08.2014.

7. In view of the foregoing, the defect memos requiring the appellants to make pre-deposit in terms of Section 35F of the Central Excise Act, 1944 (as amended with effect from 06.08.2014) read with Section 83 of the Finance Act, 1994 is upheld.

 
 
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