Md Samsuddin Ahmed vs. The Union Of INDIA And 5 Ors

Facts

The petitioner, MD Samsuddin Ahmed, proprietor of M/s S. Ahmed and Co., was issued a Demand-cum-Show Cause Notice on September 29, 2020, proposing to demand service tax of Rs. 1,46,41,544/- for the period from October 2014 to March 2018, along with interest and penalty under the Finance Act, 1994. The petitioner filed a reply on January 25, 2021. The Adjudicating Authority passed an Order-in-Original on May 31, 2022. The petitioner filed an appeal before the Commissioner (Appeals) on May 17, 2023. The Appellate Authority dismissed the appeal without considering its merits, citing the petitioner's failure to make a mandatory pre-deposit of 7.5% of the disputed amount as required by Section 35 of the Central Excise Act, 1944. Aggrieved, the petitioner filed the present writ petition.

Held

The Court did not decide the issues on merits. The judgment notes that none appeared for the petitioner when the case was called. Consequently, the Court dismissed the writ petition for non-prosecution without going into the merits of the petitioner's claim. The respondent's argument regarding the mandatory nature of pre-deposit under Section 35-F of the Central Excise Act, 1944, and the inability to waive it in writ jurisdiction, was presented but not adjudicated upon by the Court in its final decision. The operative direction was to dismiss the petition.

Key Issues

1. Whether a writ petition can be entertained when the petitioner has not preferred a statutory appeal before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT)? 2. If the writ petition is entertained, can this Court consider any issue on merits when the appeal was not entertained due to the petitioner's failure to fulfill the condition of mandatory pre-deposit at the time of filing the appeal? Petitioner's arguments: Not recorded in the judgment. Revenue's arguments: Mr. Keyal, learned counsel for the respondent GST, argued that Section 35-F of the Central Excise Act, 1944, mandates pre-deposit for filing appeals. He cited the Bombay High Court's decision in Kantilal Bhaguji Mohite vs. Commissioner, Central Excise and Service Tax-Pune III, which was upheld by the Supreme Court, holding that pre-deposit cannot be waived in exercise of writ jurisdiction. Therefore, the writ petition is liable to be dismissed.