Anand Mishra, Advocate
The newly enacted 35F of CEA,1944 w.e.f 06.08.2014 results into new era in appeals .
Query 1(a) Whether an assessee is supposed to file a stay application alongwith an appeal before CESTAT ?
Answer: No, it is not required to be filed before appellate authorities. Further,in budget speech Honourable Finance Minister had stated that
252. To expedite the process of disposal of appeals, amendments have been proposed in the Customs and Central Excise Acts with a view to freeing appellate authorities from stay applications and to take up regular appeals for final disposal .
This was further strengthened by a suitable amendment w.e.f 06.08.2014, though not proposed in Finance Bill 2014, in clause (a) of sub section (7) of Section 35B of CEA,1944 by deleting the following expression from the body of such clause :
” for grant of stay “ Hence, no stay application is required to be filed .
Query 2: Whether the pending stay applications and appeal will have to follow the existing section 35F?
Answer: The answer is Yes . Since, newly enacted Section 35F will not be applicable to stay applications and appeals filed and/or pending before the enactment of new Section 35F i.e 06.08.2014
Therefore, any extension applications filed before the enactment of Section 35F will be the last, in an appeal pending before the enactment , in as much as the extension order passed, even after the enactment , will be valid till disposal of an appeal due to an amendment ,resulting of deletion of 365 days and 180 days factor,from the body of Section 35C of CEA,1944.
Querry 3 : Whether an amount deposited during an investigation, after the issuance of a show cause notice or any other time before the order of non appellate authority will be sufficient for the purpose of mandatory deposit under the proposed Section 35F ?
Answer : Yes ,it shall be valid since Section 35F does not speak for fresh deposit in addition to the deposits made during an investigation, after the issuance of a show cause notice or any other time before the order of non appellate authority. However , if the total amount thus deposited is lesser to 7.5% and/or 10% , the difference amount needs to be deposited so that it becomes total of 7.5% and /or 10% at respective appellate levels.
It is pertinent to note that CESTAT has issued a circular dated 28.08.2014 wherein the payment during an investigation has been considered to be sufficient compliance as far as it meets the mandatory pre deposit amount .
I must point out that even before the changes in Section 35 B( 7 ) and issuance of the CESTAT circular , i highlighted and predicted such aspects in my articles published , in July 2014, on CACLUBINDIA and TAXINDIAONLINE .