Pre-deposit under Section 35F includes earlier appellate deposit, reviving appeals rejected solely for alleged non-compliance.

Mandatory pre-deposit for a second appeal under Section 35F is described as including the amount already deposited at the first appellate stage, so a separate fresh deposit is not treated as additionally required on the stated facts. Where an appeal was rejected solely for alleged non-compliance with pre-deposit, the note states that the appellate orders were set aside and the matter remitted for decision on merits. It also records that the broader issue concerning the circular-based deposit requirement was left open for consideration in an appropriate case.

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Issues: (i) Whether the amount deposited at the first appellate stage was liable to be taken into account towards the mandatory pre-deposit required for the second appeal under Section 35F of the Central Excise Act, 1944. (ii) Whether the orders of the Tribunal and the Commissioner (Appeals), dismissing the appeal on the ground of non-compliance with pre-deposit, were liable to be set aside and the matter remitted for decision on merits.

Issue (i): Whether the amount deposited at the first appellate stage was liable to be taken into account towards the mandatory pre-deposit required for the second appeal under Section 35F of the Central Excise Act, 1944.

Analysis: The Revenue accepted that, for the purpose of the statutory 10% pre-deposit for a second appeal, the amount already deposited at the stage of the first appeal is to be counted. On that basis, the appellant was treated as having complied with the mandatory deposit requirement, and the contrary view that a fresh 10% deposit was independently required was not accepted in the facts of the case.

Conclusion: The amount deposited at the first appellate stage was directed to be taken into account towards compliance with the mandatory pre-deposit requirement.

Issue (ii): Whether the orders of the Tribunal and the Commissioner (Appeals), dismissing the appeal on the ground of non-compliance with pre-deposit, were liable to be set aside and the matter remitted for decision on merits.

Analysis: Since the Commissioner (Appeals) had dismissed the appeal only on the ground of pre-deposit and not on merits, the refusal to entertain the appeal could not be sustained in view of the departmental concession on compliance. The Court therefore interfered with both orders and restored the appellate remedy for consideration on merits, while expressly leaving open the broader question regarding the circular dated 24.06.2019 for an appropriate case.

Conclusion: The orders were set aside and the matter was remitted to the Commissioner (Appeals) for fresh decision on merits.

Final Conclusion: The appeal succeeded to the extent of securing interference with the impugned orders and restoration of the matter for adjudication on merits, but the broader legal question on the circular-based deposit requirement remained undecided.

Ratio Decidendi: For a second appeal under Section 35F of the Central Excise Act, 1944, the mandatory pre-deposit is to be reckoned by including the amount already deposited at the first appellate stage, and where the appeal has been rejected only on the ground of pre-deposit, the matter may be remitted for decision on merits.

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