2015 (1) TMI 1099 - HC - Service Tax

Request for adjournment - It appears from the findings of the learned Tribunal that no one appeared for the appellant on the day when the impugned order was passed. - Waiver of predeposit - Held that - Tribunal should have considered the request of adjournment in either way. The learned Tribunal thought that it was not an application for adjournment made lawfully and that could be done only by a lawyer engaged. We record our disagreement with this approach of the learned Tribunal. Learned counsel is nothing but a recognized agent and the application for adjournment is always made by the litigant not the lawyer. Whether ground for adjournment is tenable or not is another aspect of the matter. We think that the learned Tribunal should have considered this request though not made through the lawyer. - It was the duty of the lawyer to appear before the learned Tribunal or if for any reason he does not appear, it is his primary duty to inform the Court or the Tribunal concerned as to his inability to appear and ask it to disengage from the matter. We think that it was the apparent lapse on the part of the learned lawyer, whether deliberate or indeliberate is not know to us. The learned Tribunal should have taken note of this fact. Unfortunately, it was not considered. Then, we notice that the learned Tribunal without having any application or prayer for waiver of pre- deposit, passed the impugned order. According to us, such an order is without jurisdiction. Unless a prayer is made, the learned Tribunal cannot pass a suo motu order and at the most it could have dismissed the appeal for default although it has power to pass appropriate order if the facts and circumstances of the case so warranted. Tribunal has recorded the version of the Revenue and decided that order of entire amount of pre-deposit and interest should be passed. As we have already recorded that this order is without jurisdiction when there is no such prayer or grievance is made. The learned Tribunal virtually passed order of recovery of tax and interest without having any recovery proceedings. - Decided in favour of assessee.

Summary

Issues involved:
1. Justification of passing an order of pre-deposit without an application.
2. Consideration of request for adjournment made by the appellant.
3. Authority of the Tribunal to pass an order without a waiver of pre-deposit application.
4. Jurisdiction of the Tribunal to order recovery without proper proceedings.
5. Setting aside the impugned order and allowing the appeal.

Analysis:
1. The High Court considered the substantial question of law regarding the justification of the Tribunal passing an order of pre-deposit without any application being made before it. The Court noted that no application for waiver of pre-deposit was submitted, and the Tribunal's decision to ask the appellant to deposit tax and interest without proper proceedings was deemed to be without jurisdiction. The Court emphasized that unless a formal prayer is made, the Tribunal cannot pass a suo motu order for pre-deposit, and the order in question was considered invalid.

2. The Court examined the situation where the appellant had requested an adjournment due to being unwell, but no one appeared on the appellant's behalf on the day the impugned order was passed. The Court disagreed with the Tribunal's view that only a lawyer could make a lawful adjournment request, stating that the litigant can also make such requests directly. The Court highlighted the duty of the lawyer to inform the Court if unable to appear, and criticized the Tribunal for not considering the appellant's request for adjournment.

3. In addressing the authority of the Tribunal to pass orders without a waiver of pre-deposit application, the High Court emphasized the necessity of a formal request for such waiver. The Court clarified that the Tribunal's decision to order the deposit of tax and interest without a proper application was beyond its jurisdiction. The Court stressed that the Tribunal could only dismiss the appeal for default if no waiver application was submitted.

4. The Court scrutinized the Tribunal's decision to order the payment of tax and interest without any recovery proceedings in place. The High Court concluded that the Tribunal had effectively passed an order for recovery without the appropriate legal basis, emphasizing that such actions were without jurisdiction. The Court set aside the impugned order in light of these findings.

5. Ultimately, the High Court allowed the appeal, providing the appellant with the opportunity to submit suitable applications within seven days from the date of the order. The Court made it clear that failure to submit the applications within the stipulated time would result in the appeal being deemed dismissed for default. The Court also mentioned that pending miscellaneous petitions would be closed, and no costs were awarded in the matter.