By TIOL News Service

MUMBAI, NOV 20, 2015: THE appellant debited amounts of Rs.8,03,846/-, Rs.16,329/- and Rs.8,157/- towards BED, EC & SHE Cess respectively in their CENVAT account on 1/10/2014 and madea remark that this debit is made in furtherance of the SCN dated 12/03/2014 issued to them.

The allegations leveled in the demand notice came to be confirmed by the CCE, Raigad vide an O-in-O dated 31/03/2015.

Before the CESTAT the appellant submitted that the above payments should be considered as substantive compliance with the provisions of section 35F of the CEA, 1944.

The learned AR submitted that this payment is not in compliance with the provisions of section 35F as the amount which has been debited cannot be considered as deposit and appellant should be directed to deposit 7.5% or 10% of the amount of the difference between the duties confirmed and amount deposited . For this proposition,the AR relied upon order no. M/4064/15, dated 15.07.2015 [2015-TIOL-1632-CESTAT-MUM] passed by Tribunal.

The Bench, after adverting to the order relied by the AR observed -

+ In the said order, the bench in paragraph no. 5, after reproducing the provisions of section 35F, Board Circular 984/8/2014-CX   dated 16.09.2014, categorically held that the amount deposited by the appellant was not reversed during the course of investigation, was paid by the appellant themselves and are matter of dispute with reference the duty demand confirmed. In the case in hand, we find that the impugned order is passed in adjudication proceedings in pursuance to the show cause notice issued for the demand of Central Excise duty, hence the duty amount deposited by the appellants needs to be considered as in compliance of the provisions of section 35F of the Central Excise Act, 1944 .

+ The legislative intent in framing the provisions of section 35F of Central Excise Act, 1944, was to ensure that the right of appeal of an assesse is never exhausted, but subject to the conditions that the assessee deposits an amount equivalent to 7.5% or 10% as the case may be, of the duty confirmed by lower authorities. If the proposition of the learned DR is accepted then, we will be directing the appellant assessee herein to deposit an amount in excess of the mandate of section 35F of the Central Excise Act, 1944. In our considered view, the Tribunal being a creature of statute, cannot go beyond the mandate of the statute.

The SCN issued (by the Registry) to the appellant was discharged and the Registry was directed to take on record the appeal and list the same for disposal.

(See 2015-TIOL-2463-CESTAT-MUM)