Budget 2014 – Advance Rulings and Stay/pre-deposit provisions to be amended
10 July 2014
Budget 2014 though on one hand brings some benevolent provisions in respect of applicability of Advance Ruling provisions to Private Limited Companies, the discretion of the Tribunal or the Commissioner (Appeals) in respect of grant of waiver of pre-deposit while filing appeals seems to have been withdrawn.
In continuance of the last year’s Budget amendments when resident Public Limited Companies were allowed to enjoy provisions of Advance Rulings under Central Excise (similar benefits in respect of public limited companies are available under Customs from year 2011), this year’s Budget further makes Private Limited Companies also eligible for the benefit both under Central Excise and Customs. Notifications No. 18/2014-C.E. (N.T.) and No. 51/2014-Cus. (N.T.) have been issued in this regard.
In respect of provisions relating to waiver of pre-deposit, amendments have been proposed in Section 35F of the Central Excise Act, 1944 and Section 129E of the Customs Act, 1962 to provide for deposit of specified percentage of duty/penalty or both in case of appeals to Commissioner (Appeals) or the Appellate Tribunal. According to the said proposed amendment, assessee would be required to deposit 7.5% of the duty/penalty or both in case of first appeals before the Commissioner (Appeals) or the Tribunal and amount of 10% in case of second appeals [against Order passed by Commissioner (Appeals)] to Tribunal. These provisions, which would not be applicable to pending stay applications and appeals, however provide for upper limit of Rs. 10 crore in respect of such deposits.
Further, amendments have been proposed in sub-section (2A) of Section 129B of the Customs Act and Section 35C of the Central Excise Act to omit the three provisos which provide for time period for disposal of appeals by the Tribunal in case of stay orders and subsequent vacation of stay orders if the appeals are not disposed accordingly. Proviso allowing Tribunal to extend the stay order in case the appeal is not disposed within prescribed period has also been proposed to be omitted. Interestingly, the last proviso was inserted only last year by Budget 2013.