the essay of 7 August 2019 · the untouched capture
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<p align="left"><font color="#663399" face="Verdana, Arial, Helvetica, sans-serif"><strong><font size="2">AUGUST 07, 2019 </font></strong></font></p>
<p align="center"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>Appeal - Entertainment</strong></font></p>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><u>By Vijay Kumar</u></strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>WITH </strong>the excitement on the beautiful land of Kashmir and the exit of the most beloved politician in India, maybe a tax column is the last thing anyone would like to read, but the show must go on. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In Central Excise, Customs, Service Tax, VAT, GST etc., a pre-deposit is required to be made for filing appeals before the departmental appellate authorities or the Tribunals. But when is this pre-deposit to be made? Before filing the appeal or after? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">As per Section 129 of the Customs Act, the Tribunal or the Commissioner (Appeals), as the case may be, shall not <strong>entertain </strong>any appeal unless the appellant has deposited the mandatory pre-deposit. Now, what is the <em>entertainment </em> in appeals? At what stage is an appeal <em>entertained </em>? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In a case reported as - <strong> <a href="https://taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=MTAxNTIx" target="_blank">2015-TIOL-654-CESTAT-MUM</a></strong>, the appellant submitted that the appellant is not required to make a pre-deposit of 7.5% either at the time of filing of the appeal with the Tribunal or at any stage before the Tribunal proceed to entertain the appeal. It was submitted that in the context of Section 35F 'entertain' means when the appeal is taken up for hearing on merit at the time of hearing of the appeal, the amount of 7.5% of duty should stand deposited. It is not mandatory to make this deposit before the Tribunal entertains the appeal that means before hearing of the appeal on merit. The Tribunal was not impressed and observed, </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>…the statute provides that appeal shall be entertained only when the 7.5% or 10% as the case may be of duty is deposited. As regard the submission of Ld. Counsel that the appeal cannot be dismissed for want of said deposit due to the reason that deposit is required only for entertaining the appeal by the Tribunal, we are of the view that as regard appeal procedure in this appellate Tribunal, the moment appeal is filed, it attains the stage of entertaining the appeal by the Tribunal. Unlike procedure in the Hon'ble High Court and Hon'ble Supreme Court, there is no procedure in this Appellate Tribunal for motion hearing on admission of the appeal. In this Tribunal when the appeal is filed it is registered and appeal number is allotted and thereafter the appeal is matured for considering on merit. Therefore since there is no provision of admission of the appeal in this Tribunal the moment the appeal is filed it stands admitted and become due for consideration on merit. Therefore the mandatory deposit of 7.5% or 10% as the case may be is required to be deposited by the appellant and to be complied at the time of filing of the appeal itself </em>. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Even if it is accepted that the meaning 'entertain' is 'to consider the matter on merit', the stage of considering the appeal on merit by the Tribunal starts right from the filing of the appeal</em>. </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">However, the Tribunal did not dismiss the appeal, but gave four weeks time to make the pre-deposit. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In - <strong><a href="https://taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=MTAxNTMw" target="_blank">2015-TIOL-658-CESTAT-MUM</a></strong>, the appeal was dismissed for not making the pre-deposit, but was restored by the Tribunal when the appellant made the pre-deposit after the dismissal of the appeal. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In a judgement delivered on July 10th 2019 - <a href="https://taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=MTQ5OTY3" target="_blank"><strong>2019-TIOL-263-SC-CT</strong></a>, the Supreme Court observed, </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>There is no express stipulation to deposit the tax dues in respect of which the appeal is preferred, at the time of its filing, institution or presentation as such. In the absence of such a clear stipulation, it must necessarily follow that it is open to the assessee to file the appeal within the statutory period of limitation provided therefor and later on, deposit the specified tax dues but before the appeal is taken up for consideration by the Appellate Authority for the first time – be it for condonation of delay in filing the appeal and/or to admit it on merits or otherwise. The proof of such payment having been made could be produced thereat. Failing which, the Appellate Authority will have no other option but to reject the appeal on that count. The Appellate Authority has no power to extend the time to deposit the specified tax dues. </em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>That expression "admit", however, must be read to mean filing, institution or presentation of the appeal in the office of the Appellate Authority. Whereas, the expression "admitted" used in the second proviso will have to be construed as analogous to expression "entertained". We are inclined to take this view as the setting in which the provisions under consideration appear leaves no manner of doubt that it is ascribable to the event of taking up the appeal for consideration, for the first time, to admit it on merits or otherwise and/or for condonation of delay in filing the appeal, as the case may be. Before that event occurs, it is open to the appellant to deposit the tax dues in respect of which the appeal is preferred and produce proof of such deposit before the Appellate Authority </em>. </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But the Supreme Court had some words of caution - </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>While parting, we may observe that taking advantage of the interpretation given by us, it is possible that some unscrupulous litigant (assessee) may file an appeal within the limitation period but keep it under defect so that the same does not proceed for consideration before the Appellate Authority. To obviate such a mischief, we hold and direct that the Appellate Authority shall be obliged to take up every singular appeal for consideration for admission on merits and/or for condonation of delay in filing the appeal for the first time, no later than thirty days from the date of its filing, institution or presentation in the office of the Appellate Authority. This direction shall be complied with by all concerned meticulously, without any exception. That is the only way to secure the interests of the Revenue and at the same time to effectuate the purpose underlying the proviso regarding the deposit of specified amount of tax dues</em>. </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What is the situation in appeals under the GST Act? </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">There is no <em>entertainment </em> in GST. The GST Act is clear that <em>'<strong>No appeal shall be filed,</strong> unless the appellant has paid the pre-deposit."</em> No question of entertainment, it is serious business. </font></p>
<p align="justify"><font color="#6699FF" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>HEIGHTS OF LAW-MAKING</strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">You think the Indian GST laws are confusing, complicated and draconian? Look at this extract from the Australian GST Act:</font></p>
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<td><p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF"><strong>165-55 Commissioner may disregard scheme in making declarations </strong></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF"> For the purposes of making a declaration under this Subdivision, the Commissioner may: </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(a) </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF"> treat a particular event that actually happened as not having happened; and </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(b)</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF"> treat a particular event that did not actually happen as having happened and, if appropriate, treat the event as: </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i)</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF"> having happened at a particular time; and </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii)</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF"> having involved particular action by a particular entity; and </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(c)</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF">treat a particular event that actually happened as: </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(i) </font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF">having happened at a time different from the time it actually happened; or </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(ii)</font><font size="2" face="Verdana, Arial, Helvetica, sans-serif"style="background-color:#F3DBCF"> having involved particular action by a particular entity (whether or not the event actually involved any action by that entity). </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong><font color="#6699FF">SUSHMA SWARAJ ON GST:</FONT></STRONG> A rare politician who articulately spoke on a variety of subjects, but cleverly avoided subjects over which she had no command. She would hardly talk tax, though she was a GST - Gracious, Smart and Talented politician. </font></p>
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">These are her observations in speeches made outside the country. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Recently the Government launched GST, biggest tax reform since independence. These steps opened new opportunities for trade, investment into India. </em></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><em>Today, India has passed the Goods and Services Tax legislation, through which there is one-tax across the country, without the untidy and punishing system of multiple taxes under differing categories in different parts of the country. </em></font></p>
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<p><font color="#6699FF" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>UNTIL NEXT WEEK</strong></font></p>
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