The Jharkhand High Court in its recent judgement ordered to pay a mandatory pre-deposit under 35F of the Central Excise Act for the appeal hearing.
Amar Enterprises, the Petitioner is registered with the Central Public Works Department (CPWD), SAIL, MECON, Airport Authority of India and is performing electrical repair and maintenance work on a contract basis.
During the Financial Years 2015-16 and 2016-17, the petitioner executed certain contracts with CPWD. Labouring under an impression that it was exempted from payment of service tax under Notification No. 25/2012 dated 20.06.2012 issued by the Ministry of Finance, Government of India for services provides to the Government / local authority / governmental authority by way of construction, commissioning, erection, installation, etc.
Petitioner did participate in the adjudication proceeding but was imposed with the liability vide Order-in-Original dated 31.01.2022 confirming the demand of service tax amounting to Rs. 7,66,636/- under Section 73(2) of the Finance Act, 1994 read with Section 174 of CGST Act, 2007 and penalty of the same amount as per Section 78 of the Finance Act, 1994 read with Section 174 of CGST Act, 2017.
On appeal before the Commissioner, CGST and Central Excise dismissed solely on the ground of non-payment of mandatory pre-deposit of 7.5% of the duty and penalty under section 35F of Central Excise Act, 1944.
The petitioner was unaware of the facility of making online payments through the RBI Portal, he may be also allowed to make a pre-deposit so that appeal can be heard on merits. Petitioner did not have any intention to avoid making a pre-deposit, but being unaware of RBI Instructions he could not make online payment of pre-deposit.
A single-member bench consisting of Mr Justice Deepak Roshan observed that the Respondents have also adverted to the facility provided under the RBI Instruction for making such pre-deposit by the unregistered dealer / registered non-assessees.
The Court set aside the impugned order dated 08.07.2022 (Annexure-5) passed by the Commissioner, CGST & Central Excise and allowed the petitioner to make the mandatory pre-deposit within a period of four weeks.
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