M/S. Sai Sudha Technologies vs. The Commissioner
Held
The Court held that while Section 35F of the Central Excise Act, 1944, clearly states that the pre-deposit has to be made before filing the appeal, considering that the petitioner has now made the pre-deposit, it would be in the interest of justice for the appeal to be heard and decided on its merits by the Commissioner. The Court viewed the initial filing of the appeal as irregular due to the absence of the statutory pre-deposit, which has now been regularized by the petitioner's payment. Therefore, the Court directed the Commissioner to take the petitioner's appeal on record and decide it on merit in accordance with the law. The issue of limitation was not considered to arise as the appeal had already been filed.
Facts
M/s. Sai Sudha Technologies (the petitioner) was issued a show cause notice by the Deputy Commissioner of Central Tax for non-payment of service tax amounting to Rs. 6,38,700.00 for the period 2016-17 (up to June 30, 2017). The Deputy Commissioner passed an order-in-original confirming the demand, along with interest and penalty. The petitioner filed an appeal before the Commissioner of GST & Central Tax. However, the Commissioner dismissed the appeal at the admission stage, holding that the petitioner had not complied with the pre-deposit requirement of seven and a half percent of the disputed tax as mandated by Section 35F of the Central Excise Act, 1944, read with Section 85 of the Finance Act, 1994. The petitioner subsequently deposited the pre-deposit amount and sought a hearing on merits.
Key Issues
1. Whether the order passed by the Commissioner of GST & Central Tax, rejecting the petitioner's appeal at the admission stage for non-compliance with the pre-deposit requirement under Section 35F of the Central Excise Act, 1944, is illegal and contrary to the principles of natural justice? Petitioner's contention: The petitioner argued that although the pre-deposit was not made at the time of filing the appeal, it has now been made. Therefore, the appeal should be heard on its merits. The petitioner relied on the fact that the pre-deposit has been made and sought to regularize the filing. Revenue's contention: The respondents argued that Section 35F of the Central Excise Act, 1944, mandates that the pre-deposit must be made before filing the appeal, and non-compliance renders the appeal liable for rejection. The respondents relied on the plain reading of Section 35F.
Sections Cited
Section 85, Section 35F
AI-generated summary — verify with the full judgment below
HIGH COURT FOR IHE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE TWENTIETH DAY OF DECEMBER TWO THOUSAND AND TWENTY TWO PRESENT THE HONOURABLE THE CHIEF JUSTICE UJJAL BHUYAN AND THE HONOURABLE SRI JUSTICE C.V.BHASKAR REDDY Ashok Road, Partner, Sri. [ 32ss ] Mancherial, Munukuntla Between: M/s. Sai Sudha Technologies, H.No.24-316, Telangana. Represented by its lvlanaging Sadanandam, S/o. Sri. M.Rama Swamy. ..,PETITIONER AND 1 The Commissioner of GST & Cental Tax, Hyderabad Appeals-ll, L.B.Stadium Road, Basheerbagh, Hyderabad.
The Deputy Commissroner of Central Tax, Central Excise and Service Tax, Mancherial Division. Ward No.1, By Pass Road, Mancherial.
Unron of lndia, Represented by its Secretary to Government, Finance Department, New Delhi. ...RESPONDENTS Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue an appropflate Writ or direction, ,or" particularly one in the nature of Writ of Mandamus. declaring the impugned order dated 2610912022 passed by the 1st respondent in Order-in-Appeal No.HYD-SWAX-MD-AP2-043- 22-23-S-t rejecting the
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