2014 (9) TMI 342 - HC - Service Tax

Monetary limit for filing revenue appeal - held that - as the amount involved in these two appeals is ₹ 45,000/- and ₹ 25,000/- respectively, which is below the limit of ₹ 2 lakhs prescribed in the circular dated 20-10-2010, we are dissuaded from considering the merits of the appeal and find it not necessary to go into the merits. Even as the appeal was filed before the issuance of circular dated 20-10-2010, it cannot be disputed that when the appeal came up for consideration for the first time before this court on 4-5-2011 the said circular dated 20-10-2010 prescribing the monetary limit of ₹ 2 lakhs was in vogue. Had the appellant pointed out to the court about that and the description of monetary limit therein, this court would not have issued notice. In any view when the circular was in vogue and the monetary limit was applicable on the date of consideration of appeal, the same would apply. - Decided against the assessee.

Summary

Issues:
- Interpretation of charges under Sections 65(105)(zm), 65(105)(zzl), or 65(105)(zzp) despite legal provisions
- Remand of the matter to the Original Authority for decision on charges for Terminal Handling and Bill of Lading

Analysis:
1. The appellant-Department raised substantial questions of law regarding the interpretation of charges under Sections 65(105)(zm), 65(105)(zzl), or 65(105)(zzp) despite clear legal provisions. The Tribunal remanded the matter to the Original Authority for a fresh decision on the charges for Terminal Handling and Bill of Lading. The court issued notice on 12-5-2011 to address these issues.

2. The respondent-assessee, engaged in manufacturing alkyd resins, filed refund claims covering different periods. Show cause notices were issued proposing to reject the claims, leading to partial rejection by the adjudicating authority. The Commissioner (Appeals) allowed a partial refund of service tax, prompting the Department to appeal to the Tribunal, which was dismissed, resulting in the present appeal before the High Court.

3. During the hearing, the respondent's advocate presented circulars from the Central Excise Department regarding monetary limits for filing appeals to reduce litigation burden. The circulars set limits at Rs. 2 lakhs and later Rs. 10 lakhs. The Department did not dispute the circulars' instructions or the prescribed monetary limits. No other circular authorized appeals for amounts below Rs. 10 lakhs.

4. Considering the circulars and the amounts involved in the appeals (Rs. 45,000 and Rs. 25,000), falling below the Rs. 2 lakhs limit, the court refrained from delving into the merits of the appeal. The appellant's argument that the appeal was filed before the circular's issuance was dismissed, emphasizing that the circular was in effect during the appeal's consideration, making the monetary limit applicable.

5. Consequently, due to the amounts being below the prescribed limit and the existence of the circular, the court dismissed the appeals without delving into their merits. The questions raised by the Department were left open for consideration in a suitable case, emphasizing the impact of the monetary limit set by the circular on the appeal's consideration.