2008 (2) TMI 201 - AT - Service Tax

Violation of Principles of Natural Justice remand order of commissioner is under challenge - terms of reference for remand is beyond the terms of the Show Cause Notice - aspect pertaining to limitation is also not considered - citations relied upon by appelalnts have not been examined Commissioner (Appeals) shall deal with all the grounds raised by the appellants - appeal is allowed by way of remand to the Commissioner (Appeals) for fresh hearing

Summary

Issues:
1. Allegations of exceeding the terms of the Show Cause Notice.
2. Barred demands due to time limitation.
3. Violation of Principles of Natural Justice.

Analysis:
1. The appeal challenged the Order-in-Appeal remanding the case for de novo examination by the Deputy Commissioner of Service Tax based on observations not part of the Show Cause Notice. The appellants argued that the directions given exceeded the terms of the notice, and the issue of limitation was not considered. The appellants sought a remand to the Commissioner (Appeals) citing a violation of Principles of Natural Justice. The Tribunal noted the reliance on case laws and circulars, emphasizing that adjudication must align with the allegations in the Show Cause Notice. The Tribunal found merit in the appellants' submissions, stating that any findings beyond the notice's terms would breach Principles of Natural Justice. Consequently, the impugned order was set aside, and the case remanded for fresh hearing to address all grounds raised within four months.

2. The appellants raised concerns regarding demands being barred by time limitation, asserting that the Show Cause Notice did not allege material facts for invoking a longer period. They argued that the grounds of suppression were not stated, and the terms and demands exceeded the notice's allegations. The Tribunal acknowledged the appellants' contentions, emphasizing that adjudication must adhere to the notice's scope. The Tribunal found substance in the submissions, noting that the aspect of limitation was not addressed. As a result, the impugned order was set aside, and the case remanded for a fresh hearing within four months to consider all raised grounds.

3. The violation of Principles of Natural Justice was a key issue raised by the appellants, contending that the findings in the impugned order were not informed to them, depriving them of the opportunity to contest. The Tribunal agreed with the appellants, stating that the adjudication must align with the Show Cause Notice's allegations. The Tribunal emphasized that the grounds raised by the assessee in defense must be addressed by the adjudicating authority. Consequently, the impugned order was set aside, and the case remanded for fresh hearing to ensure all grounds were considered, upholding the Principles of Natural Justice.