2015 (12) TMI 61 - AT - Customs

Denial of refund claim - Power of Commissioner (appeals) to remand - Held that - Section 128A deals with the power of Commissioner (Appeals), is similar to the adjudicating authority who may refer the case back to the adjudicating authority with such directions as he may deem fit, for fresh adjudicating or decision , which were substantially valid after the 2001 amendment. The issue is now settled by the decision of Hon ble Supreme Court in the case of Umesh Dhaimode (1997 (2) TMI 140 - SUPREME COURT OF INDIA) order dated 13.2.1997. - we agree with the law laid down by the Hon ble Supreme Court in the case of Umesh Dhaimode (supra) and also the law appreciated by the Hon ble Gujarat High Court in the case of Medico Labs. (2004 (9) TMI 108 - HIGH COURT OF GUJARAT AT AHMEDABAD) and accordingly, we dismiss the Revenue s appeal. - Decided against Revenue.

Summary

Issues:
1. Appeal against ex-parte order due to lack of show-cause notice.
2. Interpretation of powers of Commissioner (Appeals) in assessment matters.
3. Transfer of refund to Consumer Welfare Fund without notice of unjust enrichment.
4. Power of Commissioner (Appeals) to remand cases post-amendment.
5. Application of Section 128A post-2001 amendment.

Analysis:
1. The appeal was filed by the Revenue against an ex-parte order of the Commissioner (Appeals) due to the absence of a show-cause notice to the assessee. The Commissioner (Appeals) annulled the original order and directed a fresh order after providing a reasonable opportunity to the assessee, as per CBE&C-Customs Manual of Instruction.

2. The Revenue argued that the Commissioner (Appeals) exceeded their powers, citing the case of MIL India Ltd. vs. CC and the Punjab & Haryana High Court case of CC, Amritsar vs. Emkay (India) Rubber Co. The Revenue contended that the order should be set aside based on these interpretations.

3. The respondent assessee highlighted that customs duty was paid provisionally under Section 18 and later found refundable. However, the adjudicating authority, without issuing a show-cause notice, transferred the refund to the Consumer Welfare Fund citing unjust enrichment. The assessee referred to the Gujarat High Court case of Commissioner of Central Excise vs. Medico Lab to support their argument.

4. The assessee argued that the Commissioner (Appeals) retains the power to remand cases post-amendment, citing the case law and the provisions of Section 35A(3) of the Central Excise Act. The Tribunal agreed with this interpretation and dismissed the Revenue's appeal, directing the adjudicating authority to provide a hearing on unjust enrichment.

5. Considering the post-2001 amendment scenario, the Tribunal upheld the power of the Commissioner (Appeals) to remand cases as per the decision in the case of Umesh Dhaimode. The Tribunal directed the adjudicating authority to hear the assessee and make a reasoned decision within a specified timeframe.