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Finance Bill (No.2) 2014 has vide Clause 98 has proposed an amendment in Section 35F of Central Excise Act that the appeal against an Order passed by lower authorities will not be entertained unless the appellant has made a pre-deposit of 7.5 per cent in case of first stage appeal or 10 per cent of the duty demanded or penalty imposed or both in case of second stage appeals.

Similar amendment is proposed in Section 129E of the Customs Act vide Clause 83 of the Finance Bill (No.2) 2014.

Section 83 of the Finance Act, 1994 related to Service Tax is also being amended to prescribe that the provisions of section 35F of the Central Excise Act shall apply, mutatis mutandis, to service tax.

a. Amended Provisions to apply to appeals filed after 06th August 2014

b. All pending appeals/stay applications filed prior to August 6, 2014 shall be governed by the erstwhile provisions.

c. It may be noted that pre-deposit has been made condition precedent for 'entertaining appeal', as against earlier pre-deposit in 'pending appeal'.

d. However, the amended section shall not apply to the stay applications and appeals pending before any appellate authority prior to the commencement of the Finance (No. 2) Act, 2014. The appeals/applications filed before said date would continued to be governed by erstwhile provisions.

A tabulated form of the provisions have been prepared for further grasping which can be accessed

Further the CBEC has also issued a clarificatory circular in this respect.

It is once again clarified that the mandate of Pre Deposit is applicable for appeals which are filed on or after 06.08.2014. Thus even for Order before 06.08.2014 the appeal is filed after 06.08.2014, pre deposit has to be made. This can be read in para 2 of the circular 

Certain Judgements:


2014 (310) E.L.T. 304 (Tri. - Bang.)

Stay/Dispensation of pre-deposit - Mandatory pre-deposit - Stay Application not required to be filed when the appeal has been filed on or after 6-8-2014 when the Finance Act, 2014 became operational and whereunder the appellant is required to make fixed pre-deposit of 71/2% in case of First Appeal to the Tribunal and 10% in case of Second Appeal to the Tribunal - Stay Applications rejected as infructuous - Section 35F of Central Excise Act, 1944. [para 2]


Published by

CA Prakash Sajnani
Category Excise   Report

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