Ms Mukesh Kumar Singh vs. The Commissioner Appeals Central Goods And Services Tax And C Ex

Held

The Court held that the interest of justice would be met by remanding the matter to the Appellate Authority. It was observed that there was no apparent intention on the part of the petitioner to avoid the mandatory pre-deposit of 7.5% as provided under Section 35F of the Central Excise Act, 1944. The Court acknowledged the respondents' reference to the facility for making pre-deposits by unregistered dealers/registered non-assessees, as highlighted in the RBI instruction and CBIC FAQs. Consequently, the impugned order dated 12.02.2021, passed by the Commissioner (Appeals), was set aside. The petitioner was directed to make the mandatory pre-deposit within four weeks from the date of the order, after which the appeal would be heard on its merits. The Court explicitly stated that it had not gone into the merits of the case.

Facts

The petitioner, M/s Mukesh Kumar Singh, a non-registered dealer and government contractor, was assessed for service tax liability of Rs. 1,87,392/- along with interest and penalties by the Assistant Commissioner, CGST & C. Ex., Jamshedpur, for the financial year 2014-15. The petitioner appealed this order to the Commissioner (Appeals), CGST & C. Ex., Ranchi. However, the appeal was dismissed solely on the ground of non-payment of the mandatory pre-deposit. The petitioner contended that as an unregistered dealer, he faced difficulties in making the online pre-deposit and was unaware of the procedure for unregistered persons to make such payments. The petitioner did not press the grounds relating to the merits of the original order.

Key Issues

1. Whether the appeal of an unregistered dealer can be dismissed for non-payment of mandatory pre-deposit without providing assistance or instructions on how to make such a deposit, particularly when the dealer claims ignorance of the procedure? (Mixed question of law and fact, concerning Section 35F of the Central Excise Act, 1944 and principles of natural justice). Petitioner's arguments: The petitioner argued that as an unregistered dealer, he was unable to make the online pre-deposit and was unaware of the RBI Instruction No. RBI/2008-09/165 and the facility to register as a 'non-assessee' on the ACES portal for making payments. He maintained that he had no intention to avoid the pre-deposit but lacked the necessary guidance. The petitioner relied on the FAQ issued by CBIC regarding payments by non-assessees. Revenue's arguments: The respondents argued that the dismissal of the appeal for non-payment of the mandatory pre-deposit under Section 35F of the Central Excise Act, 1944, was in accordance with the law and not arbitrary. They referred to their counter-affidavit which dealt with the issue of pre-deposit.