Case Law Details
Sameer-Center For Electromagnetics Vs Commissioner of GST And Central Excise (CESTAT Chennai)
The appeal arose against an Order-in-Appeal dated 25.07.2016 by which the Commissioner (Appeals) dismissed the appellant’s appeal as not maintainable on the ground that the mandatory pre-deposit requirement under Section 35F of the Central Excise Act, 1944, read with Section 83 of the Finance Act, 1994, had not been complied with.
The appellant contended before the Tribunal that the Commissioner (Appeals) had rejected the appeal solely on the alleged failure to satisfy the pre-deposit condition without examining the merits of the case. The appellant submitted that, pursuant to Interim Order No. 162/2013 dated 07.02.2013, an amount of ₹3,00,000 had been deposited on 22.02.2013, and proof of payment had been placed before the Tribunal. On this basis, the appellant requested that the matter be remanded to the Commissioner (Appeals) for adjudication on merits.
The Department supported the findings contained in the impugned order.
The Tribunal examined the records and observed that against the confirmed demand of ₹40,14,367, the statutory pre-deposit requirement of 7.5% worked out to approximately ₹3,01,078. It further noted that the appellant had already deposited ₹16,78,101 on 01.06.2012 after the passing of the Order-in-Original dated 29.02.2012. This amount was substantially higher than the mandatory pre-deposit prescribed under Section 35F. Additionally, the appellant had deposited another ₹3,00,000 on 22.02.2013 in compliance with the Interim Order dated 07.02.2013.
FULL TEXT OF THE CESTAT CHENNAI ORDER
The present appeal is directed against Order-in-Appeal No. 414/2016(STA-I) dated 25.07.2016 passed by the Commissioner of Service Tax (Appeals-III), Chennai, whereby the Ld. Commissioner (Appeals) rejected the appeal as not maintainable on the ground that the appellant had not made the mandatory pre-deposit under Section 35F of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994.
2. Heard both sides and perused the material available on record.
3. The Ld. Advocate Ms. G. Mathanghi for the appellant submitted that the Commissioner (Appeals) dismissed the appeal solely on the ground of alleged noncompliance with the pre-deposit requirement under Section 35F of the Central Excise Act, 1944 without deciding the matter on merits. It was submitted that pursuant to Interim Order No. 162/2013 dated 07.02.2013, the appellant had deposited t3,00,000/- on 22.02.2013 and proof of such payment has now been placed before this Tribunal. She therefore prayed that the matter may be remanded to the Commissioner (Appeals) for decision on merits.
4. On the other hand, the Ld. Authorized Representative Shri M. Selvakumar for the Department, reiterated the findings contained in the impugned order.
5. We find from the records that as against the confirmed demand of 140,14,367/-, the statutory pre-deposit at 7.5% worked out to approximately t3,01,078/-. We further find that the appellant had already deposited 16,78,101/- on 01.06.2012, after the passing of Order-in-Original No. 19/2012 dated 29.02.2012, which itself was substantially in excess of the mandatory requirement under Section 35F. Even thereafter, pursuant to Interim Order No. 162/2013 dated 07.02.2013, the appellant further deposited t3,00,000/- on 22.02.2013.
6. We further find that while passing the Interim Order dated 07.02.2013, the learned Commissioner (Appeals) had recorded that “the issue seems, prima facie, to be in favour of the appellant” and had also taken note of the fact that the appellant had already paid 16.78 lakhs. Despite such findings and despite compliance with the direction regarding pre-deposit, the appeal ultimately came to be rejected on the ground of alleged non-compliance. Such rejection, ignoring the deposits already made and the prima facie findings recorded in the Interim Order itself, is wholly unjustified and unfair to the appellant and therefore cannot be sustained in law.
7. In view of the fact that the appellant has complied with the requirement of mandatory pre-deposit under Section 35F of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994, we set aside the impugned order and remand the matter back to the learned Commissioner (Appeals) with a direction to decide the same on merits, after following the principles of natural justice, and thereafter pass a reasoned order in accordance with law within a period of three months from the date of receipt of this order.
8. In the result, the appeal is allowed by way of remand.
(Order pronounced in open court on 02.06.2026)
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