Pre-deposit requirement for appeals applies to post-06.08.2014 filings and extends to service tax appeals through incorporation.

The amended pre-deposit regime under Section 35F of the Central Excise Act applies to appeals filed on or after 06.08.2014, because the filing date is decisive and the saving clause preserves only matters already pending before the appellate authority. The provision is not treated as retrospectively impairing vested rights, since Parliament confined the exception to pending appeals and stay applications. By virtue of Section 83 of the Finance Act, 1994, the same pre-deposit mandate extends to service tax appeals filed under Section 85. The resulting effect is that appeals in such matters must satisfy the statutory deposit condition before they can be entertained.

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Issues: (i) Whether the amended pre-deposit regime under Section 35F of the Central Excise Act, 1944 applies to appeals filed after 06.08.2014 even where the underlying proceedings commenced earlier; (ii) Whether the pre-deposit requirement applies to service tax appeals filed under Section 85 of the Finance Act, 1994 by virtue of Section 83 of that Act.

Issue (i): Whether the amended pre-deposit regime under Section 35F of the Central Excise Act, 1944 applies to appeals filed after 06.08.2014 even where the underlying proceedings commenced earlier.

Analysis: The amended provision opens with a clear prohibition that the Tribunal or the Commissioner (Appeals) shall not entertain any appeal unless the prescribed percentage of duty or penalty is deposited. The second proviso carves out only those stay applications and appeals that were already pending before the appellate authority prior to the commencement of the Finance (No. 2) Act, 2014. The Court followed the view that the decisive date is the date of filing of the appeal, not the date on which the original proceedings commenced. It also held that the amended provision does not retrospectively impair vested rights because Parliament expressly limited the saving to pending matters and thereby displaced the general rule regarding appeal as a vested right.

Conclusion: The amended Section 35F applies to appeals filed on or after 06.08.2014, and the constitutional challenge failed.

Issue (ii): Whether the pre-deposit requirement applies to service tax appeals filed under Section 85 of the Finance Act, 1994 by virtue of Section 83 of that Act.

Analysis: Section 83 of the Finance Act, 1994 makes the provisions of the Central Excise Act applicable to service tax matters as they apply in relation to excise duty. On that basis, the Court held that the pre-deposit mandate under Section 35F extends to appeals under Section 85 of the Finance Act, 1994. The Court also noted the governmental clarification and the consistent line of High Court decisions supporting the same interpretation.

Conclusion: The pre-deposit requirement applies to service tax appeals under Section 85 of the Finance Act, 1994.

Final Conclusion: The writ petitions were liable to fail because the amended statutory pre-deposit regime governed the appeals in question, and the challenge to its applicability was rejected.

Ratio Decidendi: Where a statute expressly mandates pre-deposit as a condition for entertaining an appeal and limits its exclusion only to pending matters, the amended requirement applies to appeals filed after its commencement and extends to allied proceedings through the incorporating provision of the parent enactment.

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