2018 (3) TMI 973 - AT - Service Tax

Principles of natural justice - CENVAT credit - Rule 6(3) of CENVAT Credit Rules, 2004 - Held that - the defense taken by the appellant in respect to the SCN needs to be considered in its correct perspective - both the lower authorities have not recorded any findings on the various submissions made by the appellant before them - matter remanded back to the adjudicating authority to reconsider the issue afresh after following the principles of natural justice - appeal allowed by way of remand.

Summary

Issues:
Whether the appellant is liable to pay demand of duty as mentioned in the show-cause notice or otherwise.

Analysis:
The appeal was directed against the Order-in-Appeal passed by the Commissioner of Central Excise and Service Tax. The issue for consideration was whether the appellant was liable to pay the duty as mentioned in the show-cause notice. The appellant had allegedly used an amount exceeding 20% of the CENVAT credit available to them for discharging service tax liability on dutiable services. It was argued that for some services, the appellant was eligible to avail 100% credit as per the exclusion clause of Rule 6(5) of the CENVAT Credit Rules, 2004, which was not considered by the authorities. The defense taken by the appellant needed to be considered in the correct perspective as the lower authorities had not recorded findings on the submissions made by the appellant. Therefore, without expressing any opinion on the merits of the case, the Tribunal set aside the impugned order and remitted the matter back to the adjudicating authority for reconsideration after following the principles of natural justice. The appellant was directed to cooperate with the authorities and produce the evidence they relied upon.

The learned counsel for the appellant argued that the lower authorities had not considered the exclusion clause of Rule 6(5) while demanding the duty. The Tribunal found that the submissions made by the appellant were not properly considered by the lower authorities. The Tribunal decided to remit the matter back to the adjudicating authority for a fresh consideration after following the principles of natural justice. The appellant was directed to cooperate and provide evidence to support their case.

The Tribunal, after hearing both sides and perusing the records, found that the issue at hand required a detailed reconsideration. The lower authorities had failed to address the submissions made by the appellant adequately. Therefore, the Tribunal decided to set aside the impugned order and remand the matter back to the adjudicating authority for a fresh determination. The appellant was instructed to assist the authorities and present the necessary evidence for a fair reconsideration of the issue.

In conclusion, the Tribunal disposed of the appeal by way of remand, emphasizing the need for a thorough reconsideration of the issue at hand. The decision was made to ensure that the appellant's submissions were properly evaluated, and the principles of natural justice were followed in the adjudication process. The appellant was given the opportunity to cooperate with the authorities and provide the required evidence for a fair resolution of the matter.