2015 (2) TMI 1226 - AT - Service Tax

Validity of the appellate order dated 26.3.2014 passed by the Commissioner (Appeals) - Refund claim - unutilized input service credit - Held that - This appeal, as already noted earlier, arises out of the Order-in-Original dated 31.10.2013 which was passed on a refund claimed by the assessee pursuant to the earliest appellate order dated 20.5.2009 and during the currency of operation of that appellate order (before its demise by the Final Order of the Tribunal dated 19.5.2014). It is axiomatic that judicial discipline demands unreserved fidelity by lower and administrative agencies to appellate orders. Since the appellate order dated 20.5.2009 had allowed assessee s refund claim in full and Revenue s application for stay was rejected by this Tribunal in Revenue s appeal No. ST/779/2009, the Assistant Commissioner could only have granted refund claimed by the appellant. He had no adjudicatory jurisdiction as he had become functus officio after passing the order dated 24.2.2009. In any event, the appellate order dated 20.5.2009, did not reinvest adjudicatory jurisdiction in the Assistant Commissioner - the order dated 31.10.2013 is patently incompetent ab initio - appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
1. Validity of the appellate order dated 26.3.2014 in Order-in-Appeal No. 04/2014
2. Competency and jurisdiction of the Assistant Commissioner in granting refund
3. Adherence to appellate orders by lower and administrative agencies
4. Review of earlier orders by the Tribunal

Analysis:

Issue 1: Validity of the Appellate Order dated 26.3.2014
The appeal was against the Order-in-Original dated 31.10.2013, where the Assistant Commissioner had granted a partial refund to the appellant. However, the Tribunal found the order to be incompetent and void ab initio. The Tribunal noted that the Assistant Commissioner had no jurisdiction to overreach the appellate proceedings and should have granted the full refund as per the appellate order dated 20.5.2009. The impugned order dated 26.3.2014 was quashed as irrelevant in light of the Final Order dated 19.5.2014 by the Tribunal in another appeal.

Issue 2: Competency and Jurisdiction of the Assistant Commissioner
The Assistant Commissioner's order dated 31.10.2013, granting a partial refund, was deemed incompetent from the beginning. The Tribunal emphasized that the Assistant Commissioner had no authority to reanalyze the merits of the claim after the appellate order had allowed the refund in full. The subsequent appeal and review orders were considered irrelevant due to the primary order's incompetence.

Issue 3: Adherence to Appellate Orders
The Tribunal stressed the importance of lower and administrative agencies adhering to appellate orders with unreserved fidelity. It was highlighted that the Assistant Commissioner should have only granted the refund as per the appellate order dated 20.5.2009, and his further analysis was beyond his adjudicatory jurisdiction. The impugned order was deemed futile and irrelevant in the context of the Final Order by the Tribunal in another appeal.

Issue 4: Review of Earlier Orders by the Tribunal
The Tribunal's review of the earlier orders led to the finding that the appellate Commissioner's order dated 20.5.2009 had ceased to exist, and the matter was remanded to the adjudicating authority for fresh determination. The Tribunal's order dated 19.5.2014 clarified the eligibility of Cenvat credit for certain services and set aside the previous orders for reconsideration.

In conclusion, the Tribunal allowed the appeal, quashed the impugned order dated 26.3.2014, and declared the Order-in-Original dated 31.10.2013 as incompetent and void ab initio. The judgment emphasized the importance of following appellate orders and maintaining judicial discipline in such matters.