2017 (5) TMI 642 - AT - Central Excise

Re-credit of CENVAT credit, reversed earlier - letter rejecting request for re-credit was interpreted as appealable order - Revenue took a view that such letter cannot be considered as an appealable order and dismissed the appeal - whether the letter rejecting request of appellant for re-credit, could be treated as a speaking order which is appealable u/s 35(1) of CEA, 1944? - Held that - Section 35(1) of CEA, 1944, says that any person aggrieved by any decision or order passed under the Act (ibid) can file an appeal u/s 35. The Section used the words decision or order . Such decision can be communicated in the form of a letter also. Merely, because the decision is in the form of a letter, it cannot take away the right of appeal from the aggrieved person - the decision of the Assistant commissioner dated 25.01.2013 is an order appealable before the Commissioner (Appeals) - the matter is remanded to the Commissioner (Appeals) for reconsideration of issue on merits - appeal allowed by way of remand.

Summary

Issues:
1. Appeal against the order rejecting re-credit of CENVAT credit.
2. Determination of whether the letter issued by the Assistant Commissioner is appealable.
3. Interpretation of Section 35(1) of the Central Excise Act, 1944.

Issue 1:
The appeal was filed against the Commissioner (Appeals) order which deemed the Assistant Commissioner's rejection of the appellant's request for re-credit of CENVAT credit as non-appealable. The appellants mistakenly reversed CENVAT credit on inputs used for job work under the belief that the goods were exempted. Upon realizing the error, they sought permission to re-credit the reversed amount. The Assistant Commissioner's response rejecting the request was considered an order by the appellants, leading to the appeal.

Issue 2:
The main contention was whether the letter dated 25.01.2013 from the Assistant Commissioner, denying the re-credit request, constituted an appealable order. The Tribunal analyzed the Notification No.214/1986 exempting goods produced on job work basis, which led to the initial confusion and subsequent request for re-credit. The Commissioner (Appeals) had dismissed the appeal, arguing that the letter was not a speaking order and failed to address time bar and unjust enrichment issues. However, the Tribunal referred to precedent and held that a letter conveying a decision and reasons for rejection can be treated as an order eligible for appeal.

Issue 3:
Section 35(1) of the Central Excise Act, 1944 was crucial in determining the appealability of the Assistant Commissioner's decision. The Tribunal emphasized that any decision or order under the Act can be appealed, even if communicated through a letter. Citing a previous case, the Tribunal clarified that if a letter conveys the grounds of rejection and the rejection itself, it qualifies as an order eligible for appellate remedies. Consequently, the Tribunal remanded the matter to the Commissioner (Appeals) for reconsideration on merits, allowing the appeal by way of remand.

This judgment underscores the importance of understanding the appealability of decisions communicated through letters, especially in cases involving tax credits and exemptions under the Central Excise Act, 1944.