The Calcutta High Court has held that the pre-deposit requirement under Section 35F of the Central Excise Act, 1944 is explicit, mandatory, and not subject to discretionary waiver even in cases of alleged financial hardship, unless a statutory exception applies. This judgment upholds existing precedent and provides binding clarity for all subordinate courts dealing with similar statutory appeals in the excise sector.
Summary
| Category | Data |
|---|---|
| Case Name | MAT/1442/2025 of ZIAUDDIN ALI Vs REGISTRAR, CESTAT AND ORS. |
| CNR | WBCHCA0412972025 |
| Date of Registration | 28-08-2025 |
| Decision Date | 28-10-2025 |
| Disposal Nature | DISMISSED |
| Judgment Author | Hon’ble Justice Debangsu Basak |
| Concurring or Dissenting Judges | Hon’ble Justice Md. Shabbar Rashidi (concurring) |
| Court | Calcutta High Court |
| Bench | Justice Debangsu Basak, Justice Md. Shabbar Rashidi |
| Precedent Value | Binding on all subordinate courts under Calcutta High Court |
| Overrules / Affirms | Affirms learned Single Judge’s reliance on Section 35F and authorities cited |
| Type of Law | Central Excise / Indirect Tax / Statutory Appeals |
| Questions of Law | Whether the pre-deposit required by Section 35F of the Central Excise Act, 1944 for filing an appeal is mandatory or can be waived on grounds of hardship |
| Ratio Decidendi | The pre-deposit requirement under Section 35F of the Central Excise Act, 1944 is explicit and mandatory; the Tribunal or Commissioner (Appeals) cannot entertain any appeal unless the statutorily prescribed amount is deposited. Financial hardship, loss in business, or inability to pay—absent a declaration of insolvency—are not grounds for waiver. The learned Single Judge was correct in dismissing the writ petition seeking such waiver. The appellate court found no reason to interfere and dismissed the appeal, affirming strict compliance with Section 35F. |
| Judgments Relied Upon | Two authorities cited before the learned Single Judge (names/details not specified in judgment) |
| Logic / Jurisprudence / Authorities Relied Upon by the Court | Express language of Section 35F of the Central Excise Act, 1944 interpreted as leaving no room for discretionary waiver; financial hardship alone is not sufficient for exemption unless statutory provisions so provide. |
| Facts as Summarised by the Court | Appellant sought waiver of pre-deposit for preferring a statutory appeal, citing inability to pay due to business losses; no evidence of indigency or insolvency was submitted; writ petition dismissed by Single Judge; appeal dismissed by division bench. |
Practical Impact
| Category | Impact |
|---|---|
| Binding On | All subordinate courts under Calcutta High Court jurisdiction |
| Persuasive For | Other High Courts, appellate tribunals, and potentially the Supreme Court |
| Overrules | None mentioned |
| Distinguishes | None specified |
| Follows | Authorities cited before Single Judge regarding Section 35F of the Central Excise Act, 1944 (names/details not specified in judgment) |
What’s New / What Lawyers Should Note
- Reaffirms that the pre-deposit requirement under Section 35F of the Central Excise Act, 1944 is an absolute statutory precondition for appeals.
- Inability to pay, business losses, or financial hardship are insufficient to secure waiver of pre-deposit unless the appellant is a declared insolvent or an express statutory exemption applies.
- Lawyers should ensure clients provide proof of insolvency if seeking exemption; mere production of loss returns or balance sheet is inadequate.
- The appellate court will not interfere absent legal error or exceptional statutory provision.
- Binding authority for all courts under Calcutta High Court to deny waiver applications on mere hardship grounds.
Summary of Legal Reasoning
- The court considered the explicit language of Section 35F of the Central Excise Act, 1944, which mandates that appeals shall not be entertained unless the statutorily prescribed pre-deposit is made.
- The court noted that previous authorities (as cited before the Single Judge) have consistently held that this requirement is not onerous or burdensome and does not grant discretionary power to waive the pre-deposit, except in cases where the statute specifically permits.
- The appellant’s reliance on loss returns and balance sheet, indicating business losses, was found insufficient for waiver when there is no indication of insolvency or indigency, nor any declaration as insolvent.
- The division bench agreed with the Single Judge’s reasoning and dismissed the appeal, holding that financial difficulty or inability to pay does not empower the court to waive the statutory pre-deposit requirement.
- The strict compliance with statutory preconditions for entertainment of appeal was reaffirmed.
Arguments by the Parties
Petitioner (Appellant):
- Sought waiver of the pre-deposit prescribed under Section 35B of the Central Excise Act, 1944 for filing an appeal.
- Claimed inability to make the pre-deposit due to business losses, as evidenced by income tax returns and balance sheet.
- Contended that pre-deposit is not a rigid precondition and can be waived in suitable cases.
Respondent:
- Asserted that Section 35F of the Central Excise Act, 1944 is explicit and requires mandatory pre-deposit before an appeal can be entertained.
- Argued that lack of evidence of indigency or insolvency means no basis for waiver exists.
- Supported the order of the learned Single Judge dismissing the writ petition based on adherence to statutory requirements.
Factual Background
The appellant sought to file a statutory appeal in relation to a matter under the Central Excise Act, 1944. For this, Section 35F of the Act prescribed a pre-deposit. The appellant moved the court seeking waiver of this pre-deposit, asserting financial inability due to business losses as shown in the income tax return and balance sheet. The Single Judge dismissed the writ petition, finding no grounds to waive the statutory requirement. Upon appeal, the division bench also dismissed the challenge and upheld the mandate of Section 35F.
Statutory Analysis
The court examined Section 35F of the Central Excise Act, 1944, which provides that no appeal shall be entertained by the Tribunal or Commissioner (Appeals) unless the appellant has deposited the statutorily prescribed amount. The court interpreted the language as explicit and not permitting of discretionary waiver based on hardship or inability to pay, except where the statute itself provides exceptions (such as insolvency or indigency proven on record).
Dissenting / Concurring Opinion Summary
Justice Md. Shabbar Rashidi concurred with the reasoning and conclusion of Justice Debangsu Basak; no dissent or additional nuance was stated.
Alert Indicators
- ✔ Precedent Followed – The court reaffirms and follows the established statutory interpretation of Section 35F of the Central Excise Act, 1944 regarding mandatory pre-deposit for filing appeals.