2018 (6) TMI 79 - HC - Central Excise

Manpower Recruitment Agency Service - principles of natural justice denied - submissions not noted by Appellant Authority - Held that - The Appellate Tribunal has not even bothered to record the gist of submissions made before it. The findings recorded are cryptic. The Appellate Tribunal has not adverted to the findings recorded by the first appellate authority - the Appellate Tribunal has failed to perform its duty. Appeal restored to the file of the Customs, Excise and Service Tax Appellate Tribunal, West Zonal Bench at Mumbai for consideration afresh - appeal allowed in part.

Summary

Issues:
Challenge to judgment of Customs, Excise and Service Tax Appellate Tribunal regarding tax liability and penalties.

Analysis:
The appellant, engaged in providing temporary laborers, challenged the judgment of the Customs, Excise and Service Tax Appellate Tribunal regarding a demand notice issued for tax liability amounting to &8377; 36,15,934 along with interest and penalties. The adjudicating authority confirmed the demand and imposed penalties, which were partially reduced by the first appellate authority. The tax liability was reduced to &8377; 16,25,417 along with interest, while penalties under sections 78 and 77 were modified. The Appellate Tribunal's judgment, running only two pages, lacked detailed reasoning. It did not note the submissions made before it, and its findings were deemed cryptic. The Tribunal acknowledged the appellant's admission of tax liability but failed to address the arguments raised or the findings of the first appellate authority. The High Court found the Tribunal's judgment to be insufficient and set it aside as perverse.

The High Court concluded that the Appellate Tribunal failed in its duty by not providing detailed reasons for its decision, making it impossible to assess the basis for the judgment. As a result, the High Court quashed the impugned judgment and order dated 29th September 2015 and restored the appeal to the file of the Customs, Excise and Service Tax Appellate Tribunal, West Zonal Bench at Mumbai for a fresh decision. The Tribunal was directed to decide the appeal afresh on its own merits, ensuring necessary priority given the appeal's vintage. All contentions on merits were kept open, and the appeal was partly allowed with no order as to costs.