Naveen Kumar Vs Commissioner Central Goods And Services Tax (Uttarakhand High Court)
The Uttarakhand High Court heard an appeal under Section 35G of the Central Excise Act, 1944 against the CESTAT order dismissing the appellant’s appeal on the ground that the mandatory pre-deposit requirement had not been fulfilled. The appellant contended that a pre-deposit of 7.5% had already been made while filing the first appeal before the Commissioner (Appeals) and that the remaining 2.5% had been deposited before filing the appeal before the Tribunal, thereby satisfying the statutory requirement of 10% under Section 35F. However, the Tribunal held that the amount deposited before the Commissioner (Appeals) could not be counted, relying on the Circular dated 24.06.2019, and also observed that the mode of payment was contrary to the instructions dated 28.10.2022 read with the Circular dated 24.06.2019.
The High Court admitted the appeal on questions relating to whether the earlier pre-deposit should be considered for compliance with the mandatory 10% pre-deposit before the Tribunal and whether the Tribunal ought to have decided the appeal on merits after the entire amount had been deposited.
During the proceedings, the Revenue, on instructions from the Department, conceded that the amount deposited at the first appellate stage is to be taken into account while determining compliance with the mandatory pre-deposit under Section 35F. The Department relied on the CESTAT Circular dated 09.07.2018, which states that the 10% pre-deposit for a second appeal is inclusive of the 7.5% deposited at the first appellate stage, that no fresh 10% is required, and that the earlier contrary view contained in the CESTAT Circular dated 27.04.2017 stands rescinded. The Department also stated that the appellant had deposited the mandatory 10% before filing the appeal before CESTAT.
