2018 (10) TMI 9 - AT - Central Excise

Tribunal clarifies predeposit rules for excise duty appeals, vacates objections, and directs condonation filings.

The Tribunal considered four appeals challenging the demand of excise duty, interest, and penalty. The Registry objected to two cases for not meeting the ... Pre-deposit - Section 35F of the Central Excise Act, 1944 - case of appellant is that they have already paid more than 7.5% which is admitted by the Department in the show-cause notice itself. They are not required to pay additional 7.5% - Held that:- The appellant has already paid duty @ 1% on the said item which is sufficient to take care of 7.5% of the duty to be deposited in terms of Section 35F. Further on identical facts for the earlier period, the Registry has not raised the objection and has considered the payment of duty made @ 1% and did not demand 7.5% under Section 35F - the defect raised by the Registry is not legally tenable and the appellant is not required to pay again 7.5% of the duty under Section 35F. Condonation of delay in filing the appeals beyond the stipulated period of 3 months - Held that:- The orders were communicated to the assessee on 14/10/2017 and the appeals were filed on 16/01/2018, which is beyond 90 days. Therefore the appellants are directed to file COD applications. Application disposed off. Issues:- Confirmation of demand of excise duty, interest, and penalty by the Commissioner- Objection raised by the Registry regarding mandatory predeposit under Section 35F- Applicability of prior cases where no objection was raised by the Registry- Interpretation of Section 35F of the Central Excise Act- Comparison of appellant's payment with the mandatory predeposit requirement- Consideration of duty paid at 1% for determining mandatory predeposit- Filing of appeals beyond the stipulated periodAnalysis:The judgment involves four appeals against orders confirming the demand of excise duty, interest, and penalty by the Commissioner. The Registry raised an objection in two cases, requiring a mandatory predeposit under Section 35F of the Central Excise Act. The appellants argued that they had already paid more than 7.5% of the duty, as admitted by the Department. The Tribunal considered the submissions and examined the payment details provided by the appellants to determine the adequacy of the predeposit.The learned counsel for the appellants contended that similar demands in prior cases did not result in objections by the Registry, emphasizing the consistency in treatment. The Tribunal reviewed the details of these prior cases to assess the applicability of the objection raised in the current appeals. Additionally, the counsel highlighted the payment and appropriation of duty in another appeal, demonstrating compliance with the mandatory predeposit requirements.The Tribunal analyzed Section 35F of the Central Excise Act along with relevant circulars issued by CBEC and CESTAT to understand the legal framework governing predeposits. The learned AR argued that regular duty payments should not be considered for mandatory predeposit calculations, citing a Tribunal decision for support. However, the Tribunal found that the appellants' 1% duty payment adequately covered the 7.5% predeposit requirement, especially considering past practices and the specific circumstances of the cases.Regarding the filing of appeals beyond the stipulated period, the Tribunal noted the communication dates of the orders and directed the appellants to file applications for condonation of delay. Ultimately, the Tribunal vacated the objections raised by the Registry concerning mandatory predeposits and instructed the appellants to file condonation of delay applications for late appeals.In conclusion, the judgment clarified the predeposit requirements under Section 35F, emphasized the importance of prior practices in similar cases, and addressed the issue of delayed appeal filings, providing a comprehensive analysis of each aspect to render a just decision.