2018 (2) TMI 1844 - CGOVT - Service Tax

Jurisdiction - power to rectify the mistake under Section 74 of the Finance Act, 1994 - Rebate of service tax - rejection on the ground that she did not have power to amend/modify her own order - Held that - It is noticed by the Government at the outset that the revision application has been filed after the gap of 10 months from the receipt of the OIA by the applicant in this case. Whereas as per Section 35EE(2) of the Central Excise Act, 1944, made applicable to the service tax matters by virtue of Section 83 of the Finance Act, 1994, the revision application was required to be filed within 3 months from the date of the order of the Commissioner (Appeals). This enormous delay is sought to be condoned on the ground that they had filed appeal wrongly against the order of the Commissioner (Appeals) before CESTAT on 28-10-2015 and it has been dismissed by the CESTAT as non-maintainable vide this order dated 3-5-2016 only and they have filed the revision application soon after that on 30-5-2016. Whereas as per sub-section (3) of Section 35EE of Central Excise Act, 1944, a revision application is to be accompanied by a fee of ₹ 1,000/- when the amount of duty, etc., levied by any Central Excise Officer is more than ₹ 1.00 lakh. This requirement of payment of fee before or at the time of filing the application is mandatory and no relaxation in this regard is provided under the aforesaid provision or any other Section. Thus if any application is not accompanied by the specified fee, such application cannot be accepted as properly filed and cannot be considered by the Government by virtue of the above-mentioned provision. The Government does not agree with this averment as Section 74 is meant for correcting a mistake apparent on the face of the order and does not authorize any one for issuing a fresh order to modify or nullify the previous order. Whereas it is manifest that the second order passed by the Deputy Commissioner on 30-9-2014 is not for correcting any apparent mistake in the earlier order dated 21-5-2013 but is a fresh order with a clear intention to override/modify the earlier order for which the Deputy Commissioner was not empowered under Section 74 of the Finance Act. Therefore, the Government is in agreement with the Commissioner (Appeals) s view that the Deputy Commissioner did not have power to review her earlier order or readjudicate the case which had already been decided by her. The revision application is not found maintainable on the ground of time limitation as well as merit.

Summary

Issues:
1. Time limitation for filing revision application.
2. Power of Deputy Commissioner to modify orders under Section 74 of the Finance Act.

Analysis:

Issue 1: Time limitation for filing revision application
The revision application was filed by the applicant against the Order-in-Appeal passed by the Commissioner of Central Excise. The Government noted a significant delay of 10 months in filing the revision application, which was required to be filed within 3 months from the date of the Commissioner (Appeals) order as per Section 35EE(2) of the Central Excise Act. The applicant sought to condone the delay by citing an appeal filed with CESTAT, which was dismissed as non-maintainable. However, the revision application was also filed without the mandatory fee of ?1,000, which was paid late. The Government emphasized that the fee requirement is mandatory, and failure to pay it at the time of filing renders the application improperly filed. Consequently, the revision application was considered time-barred, as it was filed beyond the 3-month limit even after considering the dismissal of the CESTAT appeal.

Issue 2: Power of Deputy Commissioner to modify orders under Section 74 of the Finance Act
The Deputy Commissioner initially rejected the applicant's rebate claim but later sanctioned a reduced amount. The applicant argued that the Deputy Commissioner had the power to modify the order under Section 74 of the Finance Act. However, the Government disagreed, stating that Section 74 is intended for correcting apparent mistakes in an order and not for issuing fresh orders to modify or nullify previous decisions. The Government observed that the subsequent order by the Deputy Commissioner was not for correcting a mistake but to override or modify the earlier decision, for which she lacked the authority under Section 74. Consequently, the Government supported the Commissioner (Appeals) view that the Deputy Commissioner did not have the power to review or readjudicate a case that had already been decided.

In conclusion, the revision application was deemed not maintainable due to both time limitation and lack of merit in the Deputy Commissioner's authority to modify orders under Section 74 of the Finance Act.