Monday 30 March 2015

High Court has held that mandatory pre-deposit of 7.5% not required for hearing appeal before Tribunal, if the dispute has arisen prior to August 2014

We are pleased to release a Tax Alert on the recent decision of the Kerala High Court in M/s Muthoot Finance Limited v. (1) Union of India; (2) Commissioner of Central Excise; TS-98-HC-2015(KER)-ST.

The issue discussed is whether the mandatory pre-deposit provisions of 7.5% for pursuing a remedy before the Tribunal as introduced vide the Finance (No. 2) Act, 2014 w.e.f. 6 August 2014 will be applicable for a ‘lis’ (dispute/litigation) that had arisen prior to the said amendment.

By this ruling in favour of the petitioner, any ensuing doubt relating to whether the petitioner would have to pre-deposit an amount of 7.5% of the tax confirmed against him in respect of lis commenced prior to introduction of amendment to the Finance Act, 1994 has been put to rest.

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