By the Court.—The petitioner claims to have provided between 2007-08 and 2011-12 the service of the construction of flats to Varanasi Development Authority under the Manyavar Kanshi Ram Saheri Garib Awas Yojna. On 19 September 2013, a notice to show-cause was issued to the petitioner by the Additional Commissioner, Central Excise, Customs and Service Tax, Allahabad, seeking to demand an amount of Rs. 34.02 lacs as service tax on the ground that the petitioner was providing a taxable service for which it was not registered. The amount was demanded and stated to be recoverable under the proviso to Section 73(1) of the Finance Act, 1994 together with interest and penalty. In the course of the adjudication proceedings, an order was passed on 31 March 2015 by the Additional Commissioner, Central Excise, Customs and Service Tax, Allahabad, confirming the demand of service tax in the amount of Rs. 34.02 lacs. This was accompanied by a penalty under Sections 70, 76, 77 and 78 of the Finance Act, 1994. Section 35F of the Central Excise Act, 1944 (the Act) has been made applicable by virtue of Section 83 of the Finance Act, 1994. Section 35F of the Act was amended by Finance (No. 2) Act, 2014 and reads as follows:

“35F. Deposit of certain percentage of duty demanded or penalty imposed before filing appeal.—The Tribunal or the Commissioner (Appeals), as the case may be, shall not entertain any appeal,—

(i) under sub-section (1) of Section 35, unless the appellant has deposited seven and a half percent of the duty in case where duty or duty and penalty are in dispute, or penalty, where such penalty is in dispute, in pursuance of a decision or an order passed by an officer of Central Excise lower in rank than the Commissioner of Central Excise;

(ii) against the decision or order referred to in clause (a) of sub-section (1) of Section 35B, unless the appellant has deposited seven and a half percent of the duty, in case where duty or duty and penalty are in dispute, or penalty where such penalty is in dispute, in pursuance of the decision or order appealed against;

(iii) against the decision or order referred to in clause (b) of sub-section (1) of Section 35B, unless the appellant has deposited ten percent of the duty, in case where duty or duty and penalty are in dispute, or penalty where such penalty is in dispute, in pursuance of the decision or order appealed against:

Provided that the amount required to be deposited under this section shall not exceed rupees ten crores:

Provided further that the provisions of this section shall not apply to the stay applications and appeals pending before any appellate authority prior to the commencement of the Finance (No. 2) Act, 2014.

Explanation.—For the purposes of this section “duty demanded” shall include,—

(i) amount determined under Section 11D;

(ii) amount of erroneous Cenvat credit taken;

(iii) amount payable under rule 6 of the Cenvat Credit Rules, 2001 or the Cenvat Credit Rules, 2002 or the Cenvat Credit Rules, 2004.”

2. Prior to the amendment of Section 35F of the Act, the provision as it stood earlier, was as follows:

“35F. Deposit, pending appeal of duty demanded or penalty levied.—Where in any appeal under this Chapter, the decision or order appealed against relates to any duty demanded in respect of goods which are not under the control of central excise authori­ties or any penalty levied under this Act, the person desirous of appealing against such decision or order shall, pending the appeal, deposit with the adjudicating authority the duty demanded or the penalty levied:

Provided that where in any particular case, the Commissioner (Appeals) or the Appellate Tribunal is of opinion that the deposit of duty demanded or penalty levied would cause undue hardship to such person, the Commissioner (Appeals) or, as the case may be, the Appellate Tribunal, may dispense with such deposit subject to such conditions as he or it may deem fit to impose so as to safeguard the interests of r