Goods and Services Tax – GST – By: – Dr. Sanjiv Agarwal – Dated:- 31-7-2018 Last Replied Date:- 31-7-2018 – Backdrop Appellants in tax matters, i.e. taxpayers aggrieved by tax demands and preferring appeal before higher appellate forums, are required to deposit a specified percent of total tax demand while preferring an appeal and getting it entertained by appellate authorities. Though we have moved on to a new Goods and Services Tax (GST) regime w.e.f. July 1, 2017 and appeals in GST regime are a distant reality, appeals under Central Excise / Service Tax regime are still live and are expected to continue for next few years as fresh adjudications are still being done and most of them would lead to appeals as quality of adjudication has not improved and the orders are generally being passed without proper application of mind and at times mis-interpretation of statutory provisions besides ignoring the precedents and judicial discipline. That being the order of the day, appeals are impe
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All pending stay applications in relation to appeals filed prior to Finance Act, 2014 would continue to be governed by statutory provisions prevailing at the time of filling such stay applications/appeals. Summary of Pre-deposit Provisions w.e.f. 06.08.2014 as presently applicable Appeal filed under Section Order appealed against Appeal to Percentage of mandatory pre-deposit payable Authority 35(1) of CEA and 85 of Finance Act, 1994 Order-in-Original passed by Additional Commissioner/ Joint Commissioner, or Deputy/ Assistant Commissioner Commissioner 7.5% of demand/penalty Section 35F(i) of CEA 35B(1)(a) of CEA and 86 of Finance Act, 1994 Order-in-Original passed by Commissioner of Central Excise Cestat 7.5% of demand/penalty Section 35F(ii) of CEA 35B(1) (b) of CEA and 86 of Finance Act, 1994 Order-in-Appeal passed by Commissioner (Appeals) Cestat 10% of demand/ penalty Section 35F(iii) of CEA Recent High Court Order Delhi High Court recently had an occasion to examine the provisions
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osit, 2017 (4) TMI 1222 – CESTAT NEW DELHI (LB) , stipulating that while preferring an appeal against an order of Commissioner (Appeals), whereby the appellants are required to deposit 10% of the amount of duty and penalty imposed and confirmed separately and over and above pre-deposit of 7.5% for filing first appeal before Commissioner (Appeals) was also challenged. The High Court observed / held as follows : Charging provision of the taxing law must be strictly construed. In taxing enactment one should normally look at what is said in the provision, without reading anything into it impliedly or on the basis of presumption, for there is no room for any intendment [Federation of A.P. Chambers of Commerce of Industry v. State of A.P., 2000 (8) TMI 78 – SUPREME COURT ]. An appeal, whether first or second, is continuation of original proceedings. Further, appeal being a substantive right created by the statute can be circumscribed by the conditions imposed by the Legislature, including co
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he total tax and penalty subject matter of the appeal. It is not to ignore the pre-deposit of 7.5% already made to file first appeal. There is logic in increasing pre-deposit by 2.5% when second appeal is filed, but we would be adding words to the plain and unambiguous provision if we stipulate that 10% pre-deposit will be over and above 7.5% pre-deposit made at the time of the first appeal. Expression or words 17.5% or an additional 10% deposit instead of using mere 10% pre-deposit have not been used. Appropriateness of the meaning attached to 10% pre-deposit in the context is apparent. The success rate of departmental cases before the Tribunal is very poor. This was the reason why pre-deposit of 7.5% in case of first appeal, and 10% in case of second appeal, was required to be made. Higher deposit of 10% was justified as the demand had survived test of first appeal. Reasoning observes that the assessee would not be at loss even if they were asked to pay an additional amount of 10%, f
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shed. It was directed that the petitioner and others on filing second appeal before the Tribunal are required to deposit 10% of the amount of duty / penalty as confirmed by the first appellate authority inclusive of 7.5% per-deposit made for the first appeal. 10% would not be in addition to and over and above 7.5% of pre-deposit made for the first appeal. Cestat new Circular Vide Cestat Circular No. 1/5/Circular/Cestat/2015-CR dated 5.7.2018, in compliance to the High Court of Delhi vide order dated 31-5-2018 passed in Writ Petition (Civil) No. 4551/2017 (Santani Sales Organization v. Cestat, New Delhi 2018 (6) TMI 249 – DELHI HIGH COURT, wherein it has been decided that the appellants while preferring second appeal before the Tribunal are required to deposit 10% of the amount of duty/penalty as confirmed by the Appellate Authority inclusive of 7.5% pre-deposit made for the first appeal and that 10% would not be in addition to and over and above 7.5% of pre-deposit made for the first a
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