2011 (4) TMI 471 - HC - Central Excise

Refund - Rule 5 of the Cenvat Credit Rules, 2005 read with Notification No. 11/2002-C.E. (N.T.), dated 1-3-2002 as amended - The grievance is that under Section 35-D it prescribes the procedure by which a Single Member of the Appellate Tribunal could not have decided the issue where the difference in duty is involved or the duty involved or the amount of fine or penalty interest exceed Rs. 10,00,000/-. In the instant case, the claim for refund of duty is Rs. 14,97,508 - it is clear that a Single Member could not have disposed off the claim by the assessee which is one without jurisdiction - Appeal is allowed

Summary

Issues:
Appeal challenging order rejecting claim for refund of Cenvat credit - Jurisdiction of Single Member of Tribunal under Section 35D - Procedure for disposal of cases by Single Member.

Analysis:
The judgment involves an appeal challenging the order passed by the Single Member of the Tribunal, which rejected the appellant's claim for a refund of Cenvat credit amounting to Rs. 14,77,508. The grievance was that the Single Member did not have the jurisdiction to decide on claims exceeding Rs. 10,00,000 as per Section 35D of the Cenvat Credit Rules, 2005. The appellant contended that the Single Member's decision was beyond jurisdiction due to the amount involved. The Court examined Section 35D, which restricts the Single Member's authority in cases where the difference in duty or the amount of fine or penalty exceeds ten lakh rupees. As the claim for refund in this case was Rs. 14,97,508, the Single Member was not competent to adjudicate on it.

The Court, after considering the provisions of Section 35D, held that the Single Member did not have the authority to dispose of the appellant's claim due to the amount involved exceeding the prescribed limit. Consequently, the Court allowed the appeal, set aside the impugned order, and remanded the matter back to the Tribunal for fresh consideration. The Court directed that the case should be heard by a Bench consisting of a minimum of two Members to ensure compliance with the law. The Tribunal was instructed to restore the case to its original file and dispose of the appeal within three months from the date of receipt of the Court's order.

In a procedural aspect, the Court permitted the respondent's counsel to file vakalath within four weeks. This allowance ensures that the respondent's legal representation is formalized within the specified timeframe. The judgment thus clarifies the jurisdictional limitations of a Single Member of the Tribunal under Section 35D and emphasizes the importance of adherence to procedural requirements for the proper adjudication of claims.