2017 (12) TMI 449 - AT - Service Tax

Jurisdiction - whether the Commissioner (Appeals) is empowered to consider the fresh issues for the first time as per the provisions of Rule 5 of Central Excise (Appeals) Rules, 2001? - Held that - It is the fact that the issues involved in the appeal before the Commissioner (Appeal) relate to both question of facts as well as the point of limitation, which is a question of law. Since both the aspects are involved in this appeal, the appellant can raise such points even for the first time before the ld. Commissioner (Appeals), if not raised before the Adjudicating authority - the matter should go back to him for fresh consideration of the factual aspect of taxability and the issue of limitation raised before him - appeal allowed by way of remand.

Summary

Issues: Appeal against order of Commissioner (Appeals) on grounds of not considering submissions on merits and limitation.

In this case, the appellant appealed against the order of the Commissioner (Appeals) which did not consider the submissions made by the appellant regarding the issues on merits and limitation. The Commissioner (Appeals) rejected the appeal stating that the appellant did not raise these issues before the adjudicating authority, and hence, they cannot be considered for the first time as per Rule 5 of Central Excise (Appeals) Rules, 2001. The appellant argued that they mistakenly did not pay Service Tax under the business auxiliary service category and pleaded the limitation aspect before the Commissioner (Appeals). The appellant contended that new points of law can be raised even before the Supreme Court if not raised before the lower authority, citing the judgment in the case of CCE, Ahmadabad Vs. Pioma Industries & Imperial Soda Factory. The Revenue reiterated the findings of the impugned order.

The Tribunal found that the Commissioner (Appeals) erred in rejecting the appeal solely on the ground that the issues on merits and limitation were not raised before the Adjudicating authority. The Tribunal noted that the appeal involved both factual questions and a point of law regarding limitation. It held that the appellant can raise such points for the first time before the Commissioner (Appeals) if not raised before the Adjudicating authority. Citing the judgment in the case of Pioma Industries, the Tribunal emphasized that points of law can be raised before higher authorities even if not raised before lower authorities. As the Commissioner (Appeals) did not consider the merits of the case and the limitation aspect, the Tribunal remanded the matter back to the Commissioner (Appeals) for fresh consideration of the factual taxability and limitation issues. The Tribunal directed that the appellant should be given an opportunity for a personal hearing before the Commissioner (Appeals) and allowed to make further submissions during the appeal hearing.