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Appellant had reversed CENVAT credit but this is matter of dispute w.r.t duty demand of Rs.4.5 Cr - adjustments cannot be examined for maintainability of appeal as it will amount to going into merits - Pre-deposit ordered: CESTAT

By TIOL News Service

MUMBAI, AUG 06, 2015: AGAINST an order passed by the CCE, Thane-II on 24.12.2014 the appellant is before the CESTAT.

As no pre-deposit was made with the appeal, the case was posted before the Bench for maintainability.

The appellant submitted that they have reversed certain cenvat credit during 2009-10, 2010-11, 2011-12, 2012-13 and on 6.12.2014, 14.12.2014 and which amount adds to Rs.28,45,332/- and that the balance amount of Rs.5,23,168/- has been reversed by them on 16.2.2015 and thus they have complied with the provisions of Section 35F. Support is also taken of the Board Circular No. 984/8/2014-CX dated 16.9.2014 where itis clarified that the payments during investigations will be taken into consideration for purpose of the said section.

The AR submitted that the various payments made are matter of dispute; that these are not amounts paid during investigation but are reversals which were made at various points of time; that the Commissioner has in the impugned order confirmed the amount of Rs.4,49,13,262/- and the appellant is required to deposit 7.5% of the same. Further, the question whether the said amounts can be adjusted against the demand is a matter to be decided on merit by the Tribunal and cannot be examined for maintainability of the appeal.

The Bench after considering the submissions extracted the provisions of s.35F of the CEA, 1944 and observed that the appellant is required to deposit 7.5% of the duty for filing the appeal.

Referring to paragraph 3 of the Circular No. 984/8/2014-CX dated 16.9.2014 adverted by the appellant, the CESTAT further observed -

"5. … in the present case, the said amounts have not been reversed during the course of investigation but were paid by the appellant themselves and are a matter of dispute with reference to the duty demand confirmed. We also agree with the contention of the learned Commissioner (AR) that considering these amounts at this stage will amount to going into the merits of the case, particularly as these are points of grievance of the appellant."

Concluding that the appellant is required to deposit 7.5% of the duty demanded and since they had not paid the said amount, the Bench held that the appeal was not maintainable.

However, in the interest of justice, the CESTAT gave the appellant two week's time to deposit the same and report compliance.

(See 2015-TIOL-1632-CESTAT-MUM)


 RECENT DISCUSSION(S) POST YOUR COMMENTS
   
 
Sub: Pre-deposit even if paid by credit

This decision is extremely harsh and goes against the intent of legislative amendment. object is to seek pre-deposit and not to seek double deposit. in any case, there is a doubt reg duty payment, the assessee could have been asked give an undertaking confirming the deposit

Posted by RAJEEV AGARWAL
 

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