The Chandigarh bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) remanded the issue regarding the appeal filed by the Municipal Council, Gidderbaha (the Appellant) against the order by the Commissioner of GST & Central Excise, Ludhiana (the Respondent) as non-payment of mandatory pre-deposit cannot be the sole reason for dismissal of the appeal.
Based on the allegation that the Municipal Council of Gidderbaha had provided services taxable under Section 65(105) (zzzz) and 65(105) (zzzm) of the Finance Act, 1994; renting of immovable property and selling of space or time slots for advertisements, but had failed to discharge service tax for the same, show cause notices were issued under section 73(1)/73(A) of the Finance act, 1994.
In the due process of the law, the Commissioner (Appeals) dismissed the appeal on the ground that the Municipal Council had not paid the mandatory pre-deposit under Section 35F of the Customs Act, 1994
The counsel that appeared on behalf of the Municipal Council submitted that the impugned order was not sustainable as it was passed without properly appreciating the facts and the law and had deposited Rs. 10,35,881/- and informed the superintendent through a letter
He further submitted that in the appeal filed before the Commissioner (Appeals), the issue of mandatory pre-deposit was not raised or addressed, and only in the order dismissing the appeal, the issue was raised but they had satisfied the requirement of Section 35F.
The counsel that appeared on behalf of the revenue reiterated the findings of the impugned order.
The bench consisting of S. S. Garg (Judicial Member) after hearing both sides held that “I find that the Commissioner (Appeals) has entertained the appeal without raising the objection of mandatory pre-deposit and the appeal was listed for hearing on merits and it was heard on merits and thereafter the Commissioner (Appeals) has wrongly rejected the appeal for non-compliance of Section 35F”.
The bench further stated that the Commissioner (Appeals) had not bothered to obtain the report from the lower authority with regard to the deposit. Therefore, the order passed by the Commissioner (Appeal) was set aside and the matter was remanded back to the Commissioner (Appeals). The Commissioner was further directed to dispose of the matter within three months.
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