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Clarifications – Mandatory pre-deposit

(Circular No 984/08/2014-Cx dated 16.09.2014)

(Section 35F of Central Excise Act 1944 and Sec 129E of Custom Act 1962 substituted vide Finance Act (No. 2)2014)

Clarification has been issued by the CBEC regarding Mandatory pre-deposit for entertaining appeals before commissioner (Appeals) and CESTAT. Brief facts of the same are reproduced hereunder;

Mandatory for: Appeals Filed after 06.08.2014


Quantum of pre-deposit:


Appeal Filed against order of

Appeal Filed Before




7.5% of Duty Demanded or Penalty

Authority other than Commissioner (Appeals)

Commissioner (Appeals)

Commissioner (Appeals)


10% of Duty Demanded or Penalty

- Payment made during investigation or audit can be adjusted against mandatory pre- deposit under section 35F of central Excise Act 1944 and 129E of Custom Act 1962.

- Stay application not required to file along with the appeal.

- Payment can be made by debiting Cenvat Credit account in case of duty demanded but not in case of penalty.

- If matter is decided in favour of assesse (which is generally in more than 85% cases at Tribunal level) Refund of pre-deposit within 15 days of the receipt of refund application seeking refund by the assesse.

- Refund Application to be filed with Jurisdictional AC/DC for seeking refund.

- Interest @ 6% if Payment is not made within 15 days of receipt of Application letter seeking refund. 


Published by

Sachin Sharma
Category Service Tax   Report

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