2014 (12) TMI 331 - AT - Service Tax

Rectification of mistake - Opportunity of hearing not granted - Held that - appellants were required to be given an opportunity for being heard if the impugned order had the effect of enhancing the assessment or reducing the refund or otherwise increasing the liability on the assessee. None of these consequences followed as a result of the impugned order and therefore the appellants contention that the order is not sustainable because they were not given an opportunity for being heard is obviously untenable. The appellants have nowhere argued that the adjudication order is not based on the correct appreciation of the records relating to that adjudication presented before the adjudicating authority. That being the case it is certainly not a case of mistake apparent from the record and therefore there is no infirmity in the impugned order dated 08.01.2008 and the same is legal and proper - Rectification denied.

Summary

Issues:
1. Rectification of mistake apparent in the Order-in-Original
2. Opportunity for hearing before passing the impugned order
3. Correctness of figures provided by the appellants
4. Interpretation of "mistake apparent from the record"

Analysis:
1. The appellants filed an appeal against the rejection of their application for rectification of a mistake apparent in the Order-in-Original. The Commissioner found no mistake in the adjudication order and rejected the application. The appellants contended that they were not given an opportunity for hearing before the impugned order was passed.

2. The Tribunal noted that under Section 74 of the Finance Act 1994, if an amendment affects the assessment or increases the liability of the assessee, the assessee must be given a reasonable opportunity to be heard. Since the impugned order did not result in any adverse consequences for the appellants, the argument that they were not given a hearing was deemed untenable.

3. The appellants claimed that the figures provided were not final. However, the Tribunal clarified that the adjudicating authority relies on the records presented during adjudication. The subsequent returns submitted by the appellants were not part of the adjudication records. Citing a Supreme Court case, the Tribunal explained that a mistake apparent from the record must be self-evident and not require extraneous matters to establish its incorrectness.

4. The Tribunal concluded that since the adjudication order was based on the figures and submissions provided by the appellants themselves, and there was no error apparent from the records related to the adjudication, the appeal for rectification was not sustainable. The impugned order was deemed legal and proper, leading to the dismissal of the appeal.