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General Discussion > Budget 2014 - Major concerns

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Posted: 14-07-2014

One of the major concerns to tax payers would be this:

"

  • Pre-Deposits in Appeal (First Stage) - Mandatory fixed pre-deposit of 7.5% of the duty demanded or penalty imposed or both for filing appeal before the Commissioner (Appeals) & Tribunal – It would also mean that, no stay application would be filed henceforth.
  • Pre-Deposits in Appeal (Second Stage) - Mandatory fixed pre-deposit of 10% of the duty demanded or penalty imposed or both for filing appeal before the Tribunal – It would also mean that, no stay application would be filed henceforth.
  • Ceiling for mandatory pre-deposit fixed at Rs. 10 Crores
  • Discretionary power of Tribunal to refuse the admission of appeal is increased from Rs. 50,000 to Rs. 200,000"

This would increase the harassment quotient to a new degree. Out of all the tax collecting departments, Central Excise, Customs and Service Tax has been the most harassing one. Now, this adds more teeth to them.

Following questions needs to be added:

1. The very idea of an appeal comes in because liability to pay itself is questioned. If the decision to pay is precluded then what is the idea of an appeal. The change would mean that whether the tax payer is guilty or not, he is punished. This is against the law of natural justice.

2. The budget presentation says 35% of the tax department appeals with tribunal is against them. The truth is 85% of the judgments are against them. The other 50% is actually 'remanded' back to the order passing authority for reconsideration and passing proper orders. This means that they are also against them. Only 15% of the cases are decided in favour of the department.

3. Obviously, department files more cases which are not sustainable in the eye of the law with the sole intention of harassing the tax payers. This suggestion of paying 10% upfront without any recourse would mean that we are proven wrong even when we are not!

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