TaxTMI 
TaxTMI 
TaxTMI 
2015 (6) TMI 405
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....resent appeals, even though the order-in-original was passed on16.12.2014, i.e. after the coming into force of the said provisions, but the show cause notice was issued on 22.6.2010 and pertains to period earlier to that. In view of the said position, the learned counsel argued that the substituted Section35F would not be applicable. In support of his contention, the learned counsel quoted the following case laws:- (i) K. Rama Mohana Rao & Co. vs. UOI (High Court of Judicature at Hyderabad in writ Petition no. 3393 of 2015); (ii) A.M. Motors vs. UOI (High Court of Kerala in Writ Petition (C) No. 9848 of 2015 (E) (iii) Super Threading (India) PVt. Ltd. vs. UOI (order dated 24.4.2015) in CWP no. 7696 of 2015) (iv) Hossein Kasam Dada (India) Ltd. vs State of Madhya Pradesh reported in 1983 (13) ELT 1277 (SC); (v) Kerala Transporting Co. vs. CIT (2000 111 TAXMAN 376 Ker); (vi) CIT vs. Smt. G.A. Samanthakamani (2003 259 ITR 215 Mad.); (vii) Samages Pharma Pvt. Ltd. vs. CCE, Guntur reported in 1997 (89) ELT 139 (Tri.) and (viii) Godrej Industries Ltd. vs. CCE, Mumbai - II (Central Excise Appeal No. 291 of 2013 - in the high court of Judicature at Bombay) The learned counse....
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....h para 9,10,11,12 and 13 of the said judgment to submit that since the new Section 35F, has been substituted in place of the old Section 35F, the new Section has to be treated as if the altered words have been written into the earlier Act with pen and ink and the old words scored out so that there is no need to refer to the amending Act at all. He further submitted that in view of the said position, the amended Section 35F has to be applied in the present case. It was also submitted that even in the old Section, the appellants had no right to force the Tribunal to hear the appeal without pre-deposit of the duty demanded and penalties imposed. It was only a discretionary power of the Tribunal that the Tribunal could waive such a requirement in part or full. In view of the said position, the amended law does not take away the right of the assesse to file an appeal. 4. We have heard the rival submissions. In order to appreciate the issue, Section 35F as was existing before the said amendment and after the amendment is reproduced below: Before 6.8.2014 Section 35F. Deposit, pending appeal, of duty demanded or penalty levied.- Where in any appeal under this Chapter, the decision or ....
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.... dispute, in pursuance of the decision or order appealed against; (iii) against the decision or order referred to in clause (b) of sub-section (1) of section 35B, unless the appellant has deposited ten per cent. of the duty, in case where duty or duty and penalty are in dispute, or penalty, where such penalty is in dispute, in pursuance of the decision or order appealed against: Provided that the amount required to be deposited under this section shall not exceed rupees ten crores: Provided further that the provisions of this section shall not apply to the stay applications and appeals pending before any appellate authority prior to the commencement of the Finance (No.2) Act, 2014. Explanation. - For the purposes of this section "duty demanded shall include,- (i) amount determined under section 11D; (ii) amount of erroneous Cenvat credit taken; (iv) amount payable under rule 6 of the Cenvat Credit Rules, 2001 or the Cenvat Credit Rules, 2002 or the Cenvat Credit Rules, 2004." 4.1 A perusal of the above would indicate that even before the amendment in August 2014, under the old Section, the person desirous of appealing against any decision or order shall, pending the appeal,....
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.... of 7.5% or 10% as the case may be, is required to be deposited before filing the appeal. 4.3 We also note that it is the practice in the Ministry of Finance to issue a letter at the time of introduction of Finance Bills wherein various provisions are explained in the form of D.O. letter to the Field Formation. J.S/TRU vide DOF No. 334/15/2014-TRU dated 10.7.2014 has explained about the amendment as under:- "13) Section 35F is being substituted with a new Section to prescribe a mandatory fixed pre-deposit of 7.5% of the duty demanded or penalty imposed or both for filing appeal with Commissioner (Appeals) of the Tribunal of the first stage and another 10% of the duty demanded or penalty imposed or both; for filing second stage appeal before the Tribunal. The amount of pre-deposit payable will be subject to ceiling of Rs. 10 crores." From the above TRU's letter, it becomes clear that the intention of the legislature is that the deposit of 7.5% or 10% is mandatorily required for filing appeal. Therefore objective and purpose of amended provision 35 F is to make deposit of 7.5% or 10% for filing of appeal in this Tribunal. 4.4 We have also perused the Board Circular No. 984/08....
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.... point, therefore, cannot be accepted." It would be seen that the Hon'ble Supreme Court has taken the view that the pre-existing right of appeal is not destroyed by the amendment if the amendment is not made retrospective by express words or necessary intendment. In the case before hand, as observed earlier, even in the earlier provisions the right of appeal was subject to deposit of the entire amount of duty and penalty while in the new provisions it is subject to deposit of 7.5% of the duty or penalty. Thus, the amended provisions are in fact more favourable to the appellant-assessees. Further, all that has been done is to take away the discretionary power of the tribunal to waive the requirement of deposit in cases where the Tribunal is of the view that the deposit of duty or penalty would cause undue hardship. Even in such cases, the Tribunal was required to put such conditions as it may deem fit so as to safeguard the interest of revenue. The said discretionary power was taken away. We are in total agreement with the submission of the learned AR that the second proviso makes it very clear that the amended provisions would not apply to the stay applications and appeals pen....
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....ra). Both the cases are relating to income tax and the amendments therein are not pari material with the amendment made in Section 35F. Moreover, both the judgments are based upon the Hon'ble Supreme Court's judgment in the case of Hossein Kasam Dada (supra) and as noted earlier, the said judgment helps the cause of Revenue and not the cause of the appellants. As far as this Tribunal's judgment in the case of Samages Pharma Pvt. Ltd. (supra) is concerned, it was entirely in different context where the right of appeal was restricted from an amount of Rs. 10,000/- to Rs. 50,000/- and it is in that context that this Tribunal has taken the said view and the said judgment has no application to the facts of the present case. Even in the said judgment, it has been observed that the amendment would not be retrospective in its operation so as to curtail, abrogate or take away the pre-existed statutorily vested substantive right of appeal unless the legislature either expressly or by necessary implication unambiguously intended so. In the present case, we have already come to the conclusion that the legislature has by implication made retrospective amendment. The learned counsel ....