2009 (5) TMI 10 - HC - Service Tax

Remand by tribunal revenue contend that remand order would result into compelling the revisional authority to pass an order after the period of limitation of two years and, therefore, the remand order passed is bad in the eyes of law By virtue of exercise of power by the revisional authority within a period of two years the provisions of Section 84(5) of Finance Act has worked itself one therefore, there is no further requirement of law that even on the remand the period of limitation that was initially applicable would continue to apply.

Summary

Issues:
1. Challenge to the order of the revisional authority for lack of personal hearing.
2. Interpretation of Section 84(5) of the Finance Act regarding the period of limitation for passing orders.
3. Applicability of the remand order on the period of limitation.

Analysis:

1. The High Court addressed the challenge to the order of the revisional authority due to the absence of affording the assessee-respondent(s) an opportunity of personal hearing. The Tribunal found a deficiency in the order passed by the revisional authority and remanded the matter back for a fresh order after providing a personal hearing to the assessee-respondent(s). Subsequently, rectification applications were filed, but they were dismissed. The High Court noted the importance of providing an opportunity for personal hearing to the concerned parties in such matters.

2. The main argument raised before the High Court was regarding the interpretation of Section 84(5) of the Finance Act. The counsel for the appellant contended that the remand order would exceed the two-year limitation period for passing orders by the revisional authority, thus rendering it invalid. However, the High Court rejected this argument, emphasizing that the revisional authority had revised the initial order within the two-year period as required by Section 84(5) of the Finance Act. The Court clarified that once the initial order is passed within the stipulated period, any subsequent actions by the revisional authority do not extend the limitation period.

3. The High Court further elaborated on the applicability of the remand order on the period of limitation. It emphasized that once the revisional authority had acted within the two-year timeframe from the date of the original order, the provisions of Section 84(5) of the Finance Act were satisfied. The Court dismissed the argument that the remand order would affect the limitation period, stating that such an interpretation was baseless and absurd. Additionally, the Court cited previous similar appeals where the same argument had been rejected, further solidifying its stance on the issue.

In conclusion, the High Court dismissed the appeals, upholding the validity of the revisional authority's order passed within the statutory period and rejecting the contention that the remand order would impact the limitation period for passing orders.