2011 (9) TMI 267 - AT - Service Tax

Absence of Assessee - Revenue did not bring to the notice of the Bench about pendency of cross appeal of the assessee against same order-in-appeal - Assesse contended that assessee was prevent to appear due to sudden illness of its Counsel - appeal of Revenue has been remanded in absence of Assessee and that too keeping the Bench in dark by the Representative of the Revenue before the Tribunal without mentioning pendency of Assessee s appeal it cannot be said that the case of penalty was a case under Section 11AC of Central Excise Act 1944. It is only a case under Rule 25 of Central Excise Rules 2002 - Hence decided that Since Revenue appeal has already been remanded to the Adjudicating Authority this matter shall also go back to him to pass an order confirming duty demand with levy of penalty - Held that matter should be remanded to the Adjudicating Authority.

Summary

Issues:
Appeal for recalling the order dated 1.2.2010, Reduction in penalty, Absence of Assessee during hearing, Imposition of penalty under Rule 25 of Central Excise Rules, 2002, Prejudice caused to Assessee, Failure of Revenue to inform about pendency of Assessee's appeal, Misconstruction of law by Revenue, Miscarriage of justice, Direction for re-look into Section 11A of Central Excise Act, 1944, Ethical values in Tribunal proceedings.

Analysis:
The judgment revolves around an application for recalling an order passed by the Tribunal, where both the Revenue and the Assessee had filed appeals against the same order-in-appeal. The Revenue's appeal challenged the reduction in penalty, while the Assessee sought to reverse the decision confirming duty demand but reducing the penalty. The Assessee was absent during the hearing due to the sudden illness of its Counsel, causing the Revenue's appeal to be remanded without the Tribunal being informed about the pendency of the Assessee's appeal.

The learned Advocate argued that the penalty was imposed under Rule 25 of Central Excise Rules, 2002, not under Section 11AC of the Central Excise Act, 1944. The Tribunal found that the manner in which the matter was handled prejudiced the Assessee's interests, as both appeals should have been heard together to avoid conflicting decisions. The Tribunal emphasized the importance of maintaining ethical values in guiding the Tribunal about the pendency of appeals for a fair hearing.

The judgment highlighted the need to prevent miscarriage of justice and ensure a comprehensive hearing of all relevant issues. The Tribunal concluded that the case did not fall under Section 11AC of the Central Excise Act, 1944, but under Rule 25 of Central Excise Rules, 2002. The matter was remanded to the Adjudicating Authority to pass an order based on the first appellate finding, directing a penalty of Rs. 20,000 to resolve the dispute without further litigation.

In conclusion, the judgment underscored the importance of transparency and cooperation between parties in Tribunal proceedings to facilitate a fair and efficient resolution of disputes. The Tribunal's decision aimed to rectify the procedural shortcomings and ensure a just outcome for both the Revenue and the Assessee.