TaxTMI 
TaxTMI 
2015 (11) TMI 959
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....or the sake of brevity), as amended by Section 105 of the Finance Act (No.2) 2014 (hereinafter referred to as '2014 Act', for the sake of convenience) with effect from 6/8/2014, which provides for monetary pre-deposit of 7.5% for first appeals and 10% for second appeals on the total tax or tax and penalty, demanded for entertaining such appeals. 3. In essence, the contention of the petitioners is that the requirement of the pre-deposit is in violation of Articles 14, 19(1)(g) and 265 of the Constitution of India. Therefore, they have sought a declaration that Circular No.984/08/2014-CX issued by the Government of India, Ministry of Finance, Department of Revenue (Central Board of Excise and Customs) New Delhi, dated 16/9/2014 is ultra vires the Constitution of India and a similar Circular F.No.15/CESTAT/General/2013-14 dated 4/10/2014, is also assailed. A direction is also sought to enable the petitioners to file their appeals without monetary pre-deposit of 7.5%, as the lis in so far as petitioners are concerned commenced prior to 6/8/2014, which is the date on which the amendment has been enforced. Background facts: 4. Briefly stated, the facts in W.P.Nos.10559-5....
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....r filed an appeal on 6/8/2014. The CESTAT before whom the appeal has been filed has directed the petitioner to make pre-deposit of 7.5% of the demand in terms of the amended provision Section 35F which is assailed in these writ petitions. 6. Petitioner in W.P. No.21492/2015 is a Private Limited Company engaged in Trading and Servicing of Computer Systems, CPUs, Servers, Note books, printers etc, which provides all services such as maintenance, repairs of systems and also commissioning, installation of the same, as and when required by the customer and is registered with the Service Tax Department for payment of Service Tax in the categories of 'Management, Maintenance and Repair', Commercial Training or Coaching, Business Auxiliary Service, Business Support Service, Information Technology, Software Service, Transport of Goods by GTA with STC No.AAACC9862FST002. Petitioner has opted for registration as a Large Taxpayers Unit (LTU), in the year 2008. The audit of the accounts of the petitioner-company was conducted by the Commissioner of Large Taxpayers Unit, Bengaluru for the period from December 2006 to September 2009. Petitioner was asked to reverse certain Cenvat cr....
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....endment have filed these petitions. 8. Thus, in all these cases, the grievance of the petitioners is with regard to the validity of the amendment made to Section 35F of the Act, by which, discretion vested with the appellate authorities to waive or reduce the pre-deposit with conditions has been taken away and instead is substituted by a provision for a mandatory pre-deposit of 7.5%. Submissions: 9. The submissions made on behalf of the petitioners are as follows: a) Sri. Arun Kumar, along with Sri. Shivadass, learned counsel appearing for the petitioners, contended that amendment to Section 35F of the Act effected from 6/8/2014 adversely affects a substantive and vital right of appeal of the petitioners. Elaborating the said contention, it was submitted that Section 35F of the said Act as it stood prior to the amendment, had stipulated that, where an appeal was filed in respect of the demand made under the Act the appellant had to deposit with the appellate authority the duty demanded or the penalty levied. The proviso stipulated that the Commissioner (Appeals) or the Appellate Tribunal, as the case may be, could dispense with such deposit, subject to such conditions a....
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....uld apply. That the application of the amended section retrospectively would cause great injustice to those appellants, who had the right to file an appeal under the un-amended provision. In this context, heavy reliance was placed on the decision of the Hon'ble Supreme Court in Hoosein Kasam Dada (India) Ltd. v. The State of Madhya Pradesh and others (AIR 1953 SC 221) (Hoosein Kasam Dada) to contend that the preexisting right of appeal, which was vested with the petitioners has not destroyed by the amendment made to Section 35F of the Act. It was contended that the right of appeal from the decision of an inferior authority to a superior authority or Tribunal becomes vested in a party when proceedings are first initiated in, and before a decision is given by the inferior authority. c) With reference to Garikapati Veerayya v. N.Subbaiah Choudhry and others (AIR 1957 SC 540) (Garikapati Veerayya), it was submitted that the right of appeal is a vested right and such a right to enter the superior court or tribunal accrues to the litigant and exists as on and from the date the lis commences and although it may be actually exercised when the adverse judgment is pronounced. That suc....
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....lied, irrespective of the date of filing the appeal. 10. Per contra the submission made on behalf of the respondents is as follows: a) Learned Addl. Solicitor General, Sri. K.M.Nataraj, along with Sri Neeralgi, appearing for Union of India and other respondents, contended that Section 35F does not confer any right of appeal to an assessee. Section 35B is the provision, which confers upon an aggrieved assessee a right to file an appeal, either before the Commissioner (Appeals) or before the Tribunal, as the case may be. Section 35B has not been amended. The right of appeal has remained intact and it has not been taken away by the impugned amendment. Section 35F only deals with the conditions to be complied with by an appellant in order that his appeal is entertained by the appellate authority. It is only those conditions which have been altered by the amendment. The conditions required to be complied with, by filing an appeal are not part and parcel of "the right to file an appeal" by an aggrieved party. It only regulates the filing of an appeal by an aggrieved party. The right to file an appeal is no doubt a substantive right, which has not been affected in the instant case. ....
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.... Section 5 of the General Clauses Act, 1897, it was contended that the amendment was assented to by the Hon'ble President of India on 6/8/2014 and notified on the same day and therefore, would commence from midnight of 5th and 6th August of 2014. It was further contended by the Addl. Solicitor General that the original Section 35F is wiped out from the statute book, except to the extent that has been saved in the second proviso of the amended section. It was also contended that the second proviso is declaratory in nature. That the presumption against retrospective operation is not applicable to declaratory statutes. That declaratory statutes or provisions are inacted for the purpose of removal of doubts. Also, the presumption against retrospectivity may be overcome not only by express words in the provision, but also by circumstances sufficiently strong to displace it. But for the second proviso, the amended Section 35F would not have applied to the appeals pending before the appellate authority, though filed prior to the date of amendment. e) Referring to Hoosein Kasam Dada, it was contended, that the said decision turned on its own facts and the amendment of the relevant p....
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....ppellate remedy before commissioner (Appeals) and it reads as under: "35. Appeals to Commissioner (Appeals). - (1)Any person aggrieved by any decision or order passed under this Act by a Central Excise Officer lower in rank than a Commissioner of Central Excise may appeal to the Commissioner of Central Excise (Appeals) hereafter in this Chapter referred to as the Commissioner (Appeals) within sixty days from the date of the communication to him of such decision or order: Provided that the Commissioner (Appeals) may, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of sixty days, allow it to be presented within a further period of thirty days. (1A) The Commissioner (Appeals) may, if sufficient cause is shown, at any stage of hearing of an appeal, grant time, from time to time, to the parties or any of them and adjourn the hearing of the appeal for reasons to be recorded in writing: Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal. (2) Every appeal under this section shall be in the prescribed form a....
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....e where the determination of any question having a relation to the rate of duty of excise or to the value of goods for purposes of assessment is in issue or is one of the points in issue, the difference in duty involved or the duty involved; or (ii) the amount of fine or penalty determined by such order, does not exceed fifty thousand rupees. (1A) Every appeal against any order of the nature referred to in the first proviso to sub-section (1), which is pending immediately before the commencement of Section 47 of the Finance Act, 1984 (21 of 1984), before the Appellate Tribunal and any matter arising out of, or connected with, such appeal and which is so pending shall stand transferred on such commencement to the Central Government, and the Central Government shall deal with such appeal or matter under Section 35EE as if such appeal or matter were an application or a matter arising out of an application made to it under that section. (1B) (i) The Central Board of Excise and Customs constituted under the Central Boards, of Revenue Act, 1963 (54 of 1963) may by notification in the Official Gazette, constitute such Committees as may be necessary for the purpo....
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....ntertain any appeal- (i) under sub-section (1) of Section 35, unless the appellant has deposited seven and a half 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 a decision or an order passed by an officer of Central Excise lower in rank than the Principal Commissioner of Central Excise or Commissioner of Central Excise; (ii) against the decision or order referred to in clause (a) of subsection (1) of Section 35B, unless the appellant has deposited seven and a half 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; (iii) against the decision or other referred to in clause (b) of subsection (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 or order appealed against: Provided that the amount required to be deposited under this section shall not exceed rupees ten crores: Provided f....
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....gorically states that the amendment would not apply to the stay applications and appeals pending before the Appellate Authority prior to the commencement of 2014 Act. The implication is that the proviso has distinguished between two categories of lis namely, a lis which has commenced from 6/8/2014 i.e., on the date, on which 2014 Act commenced and a lis which had commenced prior to that date. In respect of the lis which had commenced prior to 6/8/2014, the second proviso states that if prior to 6/8/2014, an appeal had been filed or a stay application had been filed and was pending before the concerned Appellate Authority, then the amendment would not apply. That means, where, in respect of a lis, which has commenced prior to 6/8/2014, an appeal had been filed or a stay application was filed prior to the said date and pending before the appellate authority on 6/8/2014 the earlier provision would apply and the Appellate Authority would continue to have the discretion to deal with the application filed under the first proviso to Section 35F as it stood prior to 6/8/2014. But in respect of those cases, where the lis though commenced prior to 6/8/2014 and where the appeals had not been ....
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....d not by the law that prevails at the date of its decision or the date of the filing of the appeal. Further, this vested right of appeal can be taken away only by a subsequent enactment, if it so provides expressly or by necessary intendment and not otherwise. Thus, the Hon'ble Supreme Court has recognized that a vested right of appeal can be taken away by an enactment if it provides so expressly or by necessary implication. If there is no such amendment made to the right of appeal, then it shall continue to be available to a party to a lis. b) But in Ganga Bai v. Vijay Kumar [(1974) 2 SCC 393] (Ganga Bai), it has been held as under:- "There is a basic distinction between the right of suit and the right of appeal. There is an inherent right in every person to bring a suit of civil nature and unless the suit is barred by statute one may, at one's peril, bring a suit of one's choice. It is no answer to a suit, howsoever frivolous to claim, that the law confers no such right to sue. A suit for its maintainability requires no authority of law and it is enough that no statute bars the suit. But the position in regard to appeals is quite the opposite. The right of....
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....ppeals, without any limitation upon the scope of the second appeal and excludes the possibility of reading the provision of Section 100 of the Code, into such provision, then, it will not be permissible to read the limitations of Section 100 of the Code into the special provision." d) In the instant case, it can be assumed that the right to file an appeal, which was available to the petitioners herein prior to 6/8/2014 under Sections 35 and 35B of the Act has been preserved intact, despite the enforcement of 2014 Act, which has amended, inter alia, Section 35F of the Act, with which we are concerned in this case. e) However, the contention of the learned counsel for the petitioners was that any change with regard to the conditions for filing of an appeal, which would adversely affect a potential appellant, in substance, affects the vested right to file an appeal. This contention was countered by learned Addl. Solicitor General by contending that conditions stipulated for filing an appeal have no nexus to the right to file an appeal. That in the instant case, all that has been done is to mandatorily deposit 7.5% of duty demanded or penalty levied at the time of filing an appea....
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....ospective, its right of appeal under the original sub-section (1) of Section 22 had remained unaffected and that accordingly, as it did not admit anything to be due, it was not liable to deposit any sum along with its appeal and the appellate Commissioner was bound to admit its appeal. That the Commissioner had no jurisdiction or power to reject it on the ground that the appeal had not been accompanied by any proof of payment of tax assessed against the appellant therein as required under the amended proviso. That the Board of Revenue and the High Court were in error in not directing the Commissioner to admit the appeal, was the contention of the appellant therein, before the Hon'ble Supreme Court. b) In order to understand that contention, it would be necessary to narrate the relevant facts of the said case. The appellant therein had submitted sales tax return on 28/11/1947. Notice was issued to the assessee to produce evidence in support of the said return. Not being satisfied by the inspection of the account books as per the correctness of the return, the Sales Tax Officer was of the opinion that the taxable turnover exceeded Rs. 2.00 lakh and submitted the case to the As....
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....first initiated in, and before a decision is given by, the inferior court. Such a vested right cannot be taken away, except by express enactment or necessary intendment. An intention to interfere with or to impair or imperil such a vested right cannot be presumed, unless such intention be clearly manifested by express words or necessary implication. d) More specifically the Hon'ble Supreme Court opined that the pre-existing right of appeal is not destroyed by the amendment, if the amendment is not made retrospective by express words or by necessary intendment. The fact that the pre-existing right of appeal continued to exist must, in its turn, necessarily imply that the old law which created that right of appeal must also exist to support the continuation of that right. As the old law continued to exist for the purpose of supporting the pre-existing right of appeal that old law must govern the exercise and enforcement of that right of appeal and there can be no question of the amended provision preventing the exercise of that right. e) According to the Hon'ble Supreme Court, the argument that the authority had no option or jurisdiction to admit the appeal unless it be....
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....een made retrospective by any express provision or by necessary implication. Therefore, the amendment took effect from the date of its enforcement and applied to all lis, which commenced on or subsequent to that date. It saved all lis, which commenced prior to that date from its applicability. Hence, relief was granted to the appellants therein. The same view was reiterated in Vithalbhai Naranbhai Patel. But no relief was granted in the latter case as the records did not disclose as to when the lis had commenced and unless it was proved as to whether the lis had commenced prior to the amendment, the dictum in Hoosein Kasam Dada would not apply, was the view of the Hon'ble Supreme Court. 20. In light of the submissions made by the respective parties and keeping in mind the amendment in question, the applicability of the principle stated in Hoosein Kasam Dada to the present case shall be considered. But before that, it is necessary to consider and answer point No.1. Re: Point No.1: Distinction between substantive law and procedural law: 21. At this stage, it would be useful to distinguish between substantive law from the law of procedure as it has been persistently co....
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..... c) So far as the administration of justice is concerned, with the application of remedies to violated rights, substantive law defines the remedy and the right, while the law of procedure defines the modes and conditions of the application of the one to the other. (source : Salmond on Jurisprudence - Twelfth Edition) 22. Two decisions of the Hon'ble Supreme Court distinguishing between substantive law and procedural law could be referred to herein. a) In the case of Hitendra Vishnu Thakur vs. State of Maharashtra [(1994)4 SCC 602] (Hitendra Vishnu Thakur), the Hon'ble Supreme Court in the context of substantive and procedural law has laid down the ambit and scope of an amending Act and its retrospective operation in the following terms: "(i) A statute which affects substantive rights is presumed to be prospective in operation unless made retrospective, either expressly or by necessary intendment, whereas a statute which merely affects procedure, unless such a construction is textually impossible, is presumed to be retrospective in its application, should not be given an extended meaning and should be strictly confined to its clearly-defined limits. ....
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.... distinction between substantive law and procedural law in the context of the operation of an amending statute or provision. If a piece of substantive law is amended, then such a law would have prospective operation unless made retrospective, either expressly or by necessary intendment. But when it comes to the procedural law, the position is contrary. In the case of an amendment of a procedural law, the amendment is always retrospective in operation, unless by a contra indication it is made only prospective. 23. The aforesaid dicta could be applied to the provisions of the Act under consideration. Chapter VIA of the Act deals with appeals. The right to file an appeal to the Commissioner (Appeals) or to the Appellate Tribunal against any order of a lower authority is prescribed in Sections 35 and 35B, respectively. The procedure to be followed by the Appellate Tribunal is stipulated in Sections 35C and 35D. Section 35EE provides for revision by the Central Government in certain cases. The provisions dealing with the right to file an appeal i.e., Sections 35 and 35B and the right to file a revision under Section 35EE are, though dealing with the right to seeking redressal of an i....
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....r are as under: a) In The Anant Mills Co. Ltd. vs. State of Gujarat and others [(1975) 2 SCC 175], the Hon'ble Supreme Court had occasion to consider vires of Section 406 (2) (e) of the Bombay Provincial Municipal Corporations Act, as amended by Gujarat Act No.5 of 1970 with regard to the entertainment of an appeal by a person, who had not deposited the amount of tax due from him and who had not been able to show to the appellate Judge that the deposit of the amount would cause him undue hardship, arising out of his own omission or default. While considering the said provision, the Hon'ble Supreme Court held that the requirement about the deposit of the amount claimed as a condition precedent to the entertainment of the appeal which seeks to challenge the imposition or the quantum of tax, did not have the effect of nullifying the right of appeal, especially keeping in view the fact that discretion was vested in the appellate judge to dispense with compliance of the above requirement. All that the statutory provision sought to do was to regulate the exercise of the right of appeal. The object being, to balance the right of appeal, which is conferred upon all persons wh....
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....permissible area to the appellant. In the above circumstances, it was also found that even in the absence of a discretion conferred on the Appellate Authority to waive or reduce the amount of pre-deposit, it was considered to be valid. c) In Vijay Prakash D.Mehta and another vs. Collector of Customs (Preventive), Bombay [(1988) 4 SCC 402] the Hon'ble Supreme Court was considering Section 129-A of Customs Act, 1962, which provides a right of appeal against the duty demanded or penalty levied. It was held that it was obligatory on the appellant to deposit the duty or penalty, pending the appeal, failing which, the Appellate Tribunal was competent to reject the appeal. The proviso to Section 129-E of Customs Act, 1962 as it stood prior to its amendment made under 2014 Act, gave power to the Appellate Authority to dispense with such deposit unconditionally or subject to such conditions, in case of undue hardship as was the proviso prior to the amendment in the instant case. The Hon'ble Supreme Court held that the observations made in Hossen Kasam Dada and Vittal Bhai Narang Bhai Patel, had no application as the right to file an appeal was granted with a condition in Se....
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....l did not make the right of appeal under Section 183(1) of the aforesaid Act as nugatory or illusory. e) In the case of State of Haryana vs. Maruti Udyog Limited and Others ((2000) 7 SCC 348) the Hon'ble Supreme Court was considering the case under Section 39(5) of the Haryana General Sales Tax Act, 1953. The said section along with the proviso dealt with payment of the admitted amount and stay of recovery of the balance amount at the time of filing of appeal. It was held that only when the conditions specified under Section 39(5) were complied with, the appeal was born for being disposed of on merits after hearing both sides. f) The expression "shall not entertain an appeal" as inserted Section 35F of the Act is of significance. In Lakshmi Ratan Engineering works Limited vs. CST (AIR 1968 SC 488), while interpreting the word "entertain" under Section 39(5) of the Haryana General Sales Tax Act, 1953, it was held that the dictionary meaning of the word "entertain" was "to deal with or admit to consideration". Then the question arose as to at what stage could the appeal be said to be entertained for the purpose of the application of Section 39(5) of the aforesaid Act. Is it....
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....before entertaining an appeal against the order passed by the Debts Recovery Tribunal, it was observed that when a statute confers a right of appeal, while granting the right, the legislature can impose conditions for the exercise of such right, so long as the conditions are not so onerous as to amount to unreasonable restrictions, rendering the right almost illusory. It was held therein that having regard to the object of the aforesaid Act the conditions hedged in the said proviso to Section 18(1) of the said Act was not onerous. h) On an analysis of the amendment of Section 35F in light of judgments of the Hon'ble Supreme Court subsequent to Hoosein Kasam Dada, it is held that Section 35F of the Act is not in the realm of right to file an appeal and thus, not a piece of substantive law. It is a condition to be complied with by an aggrieved party while instituting an appeal, which is in the realm of procedure. As held by the Hon'ble Supreme Court in subsequent decisions, a party does not have a vested right in procedural matters. 27. Thus, what emerges from the aforesaid judicial dicta is the fact that a requirement regarding deposit of amount as a condition preceden....
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....terpretation by placing reliance on "Principles of Statutory Interpretation" by Justice G.P.Singh - Ninth Edition (Reprint) on which, the Hon'ble Supreme Court has relied upon in the case of Zile Singh Vs. State of Haryana [(2004)8 SCC 1] (Zile Singh). b) In the instant case, Section 35-F as it stood on the statutory book has been repealed by 2014 Act, the repeal is by way of substitution of the earlier provision. Therefore, what has to be considered in the instant case is the effect of repeal of Section 35-F and in its place, a new section being substituted. Power to make a law with respect to subjects enumerated in the three lists of VII Schedule of the Constitution carries with it the power to amend or repeal a law on those subjects. An Act or a provision in an Act may be repealed by a later, distinct and repealing enactment or provision as the case may be, which could be inconsistent with the existing Act or provision. A repeal of a provision may be by express words in a later enactment made by way of an amendment or, may be implied on considerations of inconsistency or irreconcilability of an earlier provision with those of a later provision. Normally, there is no real ....
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..... The District Magistrate Thane, Bombay & two others (AIR 1952 SC 324), the following observation made by the Hon'ble Supreme Court, in paragraph-7 are relevant: "The rule is that when a subsequent Act amends an earlier one in such a way as to incorporate itself, or a part of itself, into the earlier, then the earlier Act must thereafter be read and construed (except where that would lead to a repugnancy, inconsistency or absurdity) as if the altered words had been written into the earlier Act with pen and ink and the old words scored out so that thereafter there is no need to refer to the amending Act at all." f) 'Commencement', used with reference to an Act, means the day on which an Act comes into force. Unless provided otherwise, a Central Act comes into operation on the day it receives the Presidential assent and is construed as coming into operation immediately on the expiration of the day preceding its commencement - Section 5 of General Clauses Act, 1897. In Zile Singh the Hon'ble Supreme Court has at paragraphs 13 and 15 opined as under: "13. It is a cardinal principle of construction that every statute is prima facie prospective unless....
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....an Act of Parliament is not to be given retrospective effect applies only to statutes which affect vested rights. It does not apply to statues which only alter the form of procedure or the admissibility of evidence, or the effect which the courts give to evidence" - Blyth v. Blyth [(1966)1 All.E.R.524]). If the new Act affects matters of procedure only, then, prima facie, "it applies to all actions pending as well as future." According to Maxwell: "Interpretation of Statutes", 11th Edition, p.216 "No person has a vested right in any course of procedure. He has only the right of prosecution or defence in the manner prescribed for the time being by or for the Court in which the case is pending, and if, by an Act of Parliament the mode of procedure is altered, he has no other right than to proceed according to the altered mode". h) Thus, in deciding the question of applicability of a particular statute to past events, the language used is a crucial factor to be taken into account; but it cannot be stated as an inflexible rule. The real issue in each case is as to the dominant intention of the Legislature to be gathered from the language used, the object indicated, the nature of rig....
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....the proviso would fall within the main enactment. Further, a proviso cannot be construed as nullifying the enactment or as taking away completely a right conferred by the enactment. b) In this regard, learned Author, Justice G.P.Singh has, in "Principles of Statutory Interpretation", enunciated certain rules collated from judicial precedents. Firstly, a proviso is not to be construed as excluding or adding something by implication i.e., when on a fair construction, the principal provision is clear, a proviso cannot expand or limit it. Secondly, a proviso has to be construed in relation to which it is appended i.e., normally, a proviso does not travel beyond the provision to which it is a proviso. A proviso carves out an exception to the main provision to which it has been enacted as a proviso and to no other. However, if a proviso in a statute does not form part of a section but is itself enacted as a separate section, then it becomes necessary to determine as to which section the proviso is enacted as an exception or qualification. Sometimes, a proviso is used as a guide to construction of the main section. Thirdly, when there are two possible construction of words to be found ....
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.... to be otiose and to have achieved nothing. (c) In Kedarnath Jute Manufacturing Co. Ltd., v. The Commercial Tax Officer and Others [AIR 1966 SC 12], it was observed that "the effect of an excepting or qualifying proviso, according to the ordinary rules of construction, is to except out of the preceding portion of the enactment or to qualify something enacted therein, which, but for the proviso, would be within it". [See "Craies" on Statute Law - 6th Edition - P.217]. In this case, the Court was considering Section 5(2) (a) (ii) of Bengal Finance Sales Tax Act, 1941 and Rule 27-A of Bengal Sales Tax Rules. (d) In Dattatraya Govind Mahajan and Others v. The State of Maharashtra and another [AIR 1977 SC 915], a Constitution Bench of the Apex Court, while considering the amendment made to Maharashtra Agricultural Lands (Ceiling on Holdings) Act, 1961, in the context of Article 31B of the Constitution and the second proviso thereto, reiterated what was stated in Ishverlal's case, supra. (e) In S.Sundaram Pillai, etc, v. V.R.Pattabiraman [AIR 1985 SC 582], while dealing with the scope of a proviso and explanation to sub-section (2) of Section 10 of Tamil Nadu Buildings (Leas....
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....o the will and inbuilt policy of the Legislature as discernible from the object and scheme of the enactment and the language employed therein. The words in a statute often take their meaning in the context of a statute as a whole. They are, therefore, not to be construed in isolation. 30. In light of the aforesaid discussion, what emerges is that the right to file an appeal envisaged under Sections 35 and 35B of the Act remains unaltered and is available to an aggrieved party despite the amendment made to Section 35F of the Act. Sections 35 and 35B of the Act are substantive law, which are not in the realm of procedure. But Section 35F is a piece of procedural law, as has been held above. There is no vested right available to any party in matters of procedure. The changes brought about by amendment made to Section 35F are noted in paragraph Nos. 15 and 17 above. The object of amending Section 35F of the Act is to withdraw the discretion granted to the appellate authorities in the matter of making pre-deposit at the time of filing the appeal by an aggrieved party. As submitted by Additional Solicitor General, there has been innumerable litigations under the first proviso to Secti....
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....fect. Parliament was also conscious of the fact that as on 6/8/2014, many appeals would be pending before various appellate authorities throughout the country where applications for exercise of discretion of such appellate authorities regarding pre-deposit of duty or penalty had to be considered and disposed of. Therefore, Parliament was vigilant to ensure that the appellate authority or tribunal would continue to have jurisdiction to exercise discretion in respect of the applications filed under the proviso to Section 35F as it stood prior to amendment. Thus, if prior to 6/8/2014, an appeal had been preferred by an aggrieved party and the application and appeal were pending before the appellate authority, then the appellate authority could exercise its discretion with regard to the pre-deposit to be made by such a party under the provision as it stood prior to amendment. But if no appeal had been filed prior to 6/8/2014, then the amended Section 35F would apply although the lis had commenced prior to 6/8/2014 as the amendment has a retrospective effect. The amendment, thus, has no bearing on the date on which the particular lis had commenced. This is for the obvious reason that in....
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....Section 35F in the instant case clearly distinguishes the provision amended in that case. b) In Hoosein Kasam Dada, the Hon'ble Supreme Court placed reliance on a decision of the Privy Council in Colonial Sugar Refining Company. It was held therein that the right to file an appeal was a substantive right and not a mere matter of procedure. It is a vested right which inheres in a party from the commencement of the action in the Court of first instance and such a right cannot be taken away except by an express provision or by a necessary implication. In the aforementioned case, the Privy Council was considering a situation wherein the right to file an appeal from a Supreme Court of Australia to the Privy Council given by the Order in Council of 1860 was taken away and the only appeal therefrom was directed to lie to the High Court of Australia. In that case, it was in fact held, to deprive a suitor in a pending action of an appeal to a superior tribunal, which belonged to him as of right, is a very different thing, from regulating procedure. It was held that there was no difference between abolishing an appeal altogether and transferring the appeal to the new tribunal. In eith....
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.... an amendment made to a substantive legislation and not to an amendment made to a procedural law, which is under consideration in the instant case. Infact, in State of Bombay v. Supreme General Films Exchange Ltd., (Supra) and in Ramesh Singh v. Cintadevi (Supra), it has been categorically held by the Hon'ble Supreme Court that where an onerous condition is imposed in the matter of filing of appeals, it is not retrospective, unless it says so expressly or by necessary intendment. This is because the right to file an appeal is crystallized on the institution of the application of the suit in the first instance. The aforesaid decisions are not applicable to these cases in view of the second proviso in Section 35F of the Act. In Allied motors (P) Ltd. v. Commissioner of Income Tax, Delhi (supra), it has been held that a proviso, is inserted to remedy unintended consequences and to make the provision workable. A proviso has to be read into the section to give it a reasonable interpretation when the section requires to be treated as retrospective in operation so that the reasonable interpretation can be given to the section as a whole. In M/s. National Traders v. State of Karnataka ....
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....may be is not an absolute right, but a conditional one. (2) In view of a plethora of decisions of the Hon'ble Supreme Court, it is held that in the instant case, the right to file an appeal under Sections 35 and 35B of the Act is in no way affected by the amendment made to Section 35F of the Act requiring pre-deposit to be made at the time of preferring the appeal. Such a condition regarding pre-deposit is made with a view to regulate the exercise of the right of appeal so as to enforce the order appealed against in case the appeal is ultimately dismissed. (3) Section 35F of the Act has retrospective operation and is not restricted to only prospective cases. It applies to all lis which have commenced prior to or after the enforcement of the amendment, except to cases covered under the second proviso thereof. (4) That in view of the insertion of second proviso to amended Section 35F of the Act, it is held that the same is in the nature of a saving clause, keeping intact the earlier provision of Section 35F to be made applicable to circumstances noted under the second proviso. That in all other cases not covered under the second proviso, the amended Section 35F is applic....