2016 (9) TMI 1135 - AT - Service Tax

Power and jurisdiction of Commissioner - Commissioner directed the Assistant Commissioner to file an appeal before the Commissioner (Appeals) against the order of original adjudicating authority prior to 19.08.2009 - Held that - Sections 84 clearly reveals that prior to 19.08.2009, it was the Commissioner himself who was having the power and jurisdiction to call for the records of proceedings before the adjudicating authority and was empowered to pass an order in respect of the same as he may deem fit. However, w.e.f. 19.08.2009 the provisions were changed and the Commissioner was empowered to examine the order of the adjudicating authority and if he was not satisfied, to direct the said authority to file an appeal before the Commissioner (Appeals). The impugned order of the Assistant Commissioner, in the present proceedings, was passed on 28.01.2009 and the order in review by the Commissioner directing the Assistant Commissioner to file an appeal was passed on 05.03.2009 i.e. well before 19.08.2009. As such, it can be safely held that, during the relevant period, there were no powers or jurisdiction with the Commissioner to direct the Assistant Commissioner to challenge the order passed by him before the Commissioner (Appeals). As such, the appeal filed by the Assistant Commissioner before the Commissioner (Appeals) in terms of the order-in-review dated 05.03.2009 is without jurisdiction and against the clear law laid down in the Act. Consequently, the order-in-original passed by the Commissioner (Appeals) is bad in law, being beyond jurisdiction. Refund claim - service tax paid on various service utilized for export of the goods - Notification No. 41/2007-ST dated 6.10.2007 - Held that - we note that certain provisions of Central Excise Act, 1944 have been adopted for the disputes relating to service tax in terms of the provisions of Section 83 of the Finance Act, 1994. On going through the Section 83 of the Finance Act, 1994, we note that while adopting certain provisions of Central Excise Act, 1944, which stand mentioned in the said Section itself, Section 35-E does not stand adopted. In this view also, we find that the order directing the lower authority to file an appeal before the Commissioner (Appeals) is beyond the scope of Section 83 of the Finance Act, 1994 itself. Therefore, by following the various decisions, the impugned order of commissioner (Appeals) is without jurisdiction and the same is accordingly set aside. - Decided in favour of appellant

Summary

Issues:
Refund claim for service tax paid on international-in-bound roaming services; Jurisdiction of Commissioner to direct lower authority to file an appeal before Commissioner (Appeals); Applicability of Section 84 of the Finance Act, 1994; Adoption of provisions of Central Excise Act, 1944 for service tax disputes.

Analysis:
1. The Appellant, engaged in providing telecom services, filed a refund claim for service tax paid on international-in-bound roaming services, retrospectively exempted by Notification No. 36/2007-ST. The Assistant Commissioner sanctioned the refund claim under Section 11-B of the Central Excise Act, 1944, applicable to service tax by Section 83 of the Finance Act, 1994.

2. The Commissioner reviewed the Assistant Commissioner's order and directed to file an appeal before the Commissioner (Appeals). The Appellant challenged this direction, arguing that the Commissioner lacked the power to issue such a directive during the relevant period, citing Section 84 of the Finance Act, 1994.

3. Section 84(1) of the Finance Act, 1994, before 19.08.2009, empowered the Commissioner to call for records and pass orders. Post 19.08.2009, the Commissioner could direct the lower authority to file an appeal. As the impugned order was pre-19.08.2009, the Commissioner lacked jurisdiction to issue the appeal filing directive, rendering the subsequent appeal and order-in-appeal invalid.

4. The Commissioner's review order was under Section 35-E(2) of the Central Excise Act, 1944, while the dispute pertained to service tax. Notably, Section 83 of the Finance Act, 1994, adopting certain Central Excise Act provisions, did not include Section 35-E. Therefore, the directive to appeal was beyond the scope of the Finance Act, 1994.

5. Previous Tribunal decisions, like Acree Ispat Udyog Ltd. and Navin Chemical Enterprises, established that pre-19.08.2009, the Commissioner could not direct subordinates to file appeals. Such directives were deemed unlawful, leading to the setting aside of resultant orders-in-appeal.

6. In alignment with the precedent and legal analysis, the Tribunal found the Commissioner (Appeals) order to be without jurisdiction. Consequently, the order was set aside, and the appeal was allowed in favor of the assessee, granting consequential relief.