2007 (7) TMI 112 - AT - Service Tax

Drilling charges - Appellant claim the service tax levied i.e. 10-9-04 and hence no tax can be levied for the period 1997-98 - Adjudicating authority has not passed a speaking order after giving on opportunity being heard - Matter remanded

Summary

Issues:
1. Restoration of appeal due to COD clearance.
2. Condonation of Delay (COD) in filing the appeal.
3. Dismissal of stay petition as the tax amount was paid.
4. Lack of proper hearing and speaking order by jurisdictional authority.
5. Setting aside the lower appellate authority's order and remanding the matter for proper hearing and decision.

Analysis:
1. The judgment addresses the issue of restoration of appeal due to obtaining Committee on Disputes (COD) clearance. The appellants, a Public Sector Undertaking, had their appeal dismissed earlier due to the lack of COD clearance. However, after obtaining the necessary clearance, the order of dismissal was recalled, and the appeal was restored to its original number. The Miscellaneous Application (MA) for Restoration of Appeal (ROA) was allowed by the tribunal.

2. The tribunal also considered the appellants' Miscellaneous Application (MA) for Condonation of Delay (COD) in filing the appeal. It was noted that there was a delay in filing the appeal, as the verification clause in the appeal memorandum was signed after the stated filing date. The delay was condoned after the appellants explained that initially only one copy of the appeal was filed, and additional copies were filed later to rectify defects. The tribunal allowed the MA for COD.

3. The judgment further mentions the dismissal of the stay petition by the appellants' Senior Advocate, as the entire demanded tax amount had been paid by the appellants, rendering the stay petition infructuous.

4. The tribunal highlighted the issue of the jurisdictional Assistant Commissioner/Deputy Commissioner not hearing the appellants or passing a speaking order on the disputed issue regarding the liability of drilling charges to service tax. The appellants contested that specific service tax on drilling charges was imposed only from a certain date and should not apply to the impugned period. They also clarified that they did not contest the tax on other charges. Due to the lack of proper hearing and speaking order, the tribunal set aside the lower appellate authority's order and remanded the matter to the jurisdictional authority for a thorough hearing and a speaking order.

5. Finally, the appeal was allowed by way of remand, with the tribunal emphasizing the need for the jurisdictional authority to provide the appellants with an adequate opportunity for hearing, consider all relevant aspects of the case, including audited amounts received from customers, and pass a speaking order to ensure a fair decision.