2018 (7) TMI 1783 - HC - Central Excise

Non-speaking order - Whether Hon'ble CESTAT is correct remanding the case for fresh adjudication on a new ground i.e.excisability dutiability of RFO, which was not a ground for appeal, without calling for views from the Department, as per Rule 10 of CESTAT (Procedure) Rules, 1982? - Held that - In M/S. NANDHI SPINNING MILLS (P) LIMITED VERSUS THE COMMISSIONER OF CENTRAL EXCISE 2017 (11) TMI 654 - MADRAS HIGH COURT , it was held that The tribunal is a final fact finding authority. Though the tribunal has considered the grounds of appeal, there is no discussion. The matter be remitted back to CESTAT, Chennai. CESTAT, Chennai, is directed to issue notice to both parties and give opportunity to the parties to raise all contentious issues - appeal allowed by way of remand.

Summary

Issues Involved:
1. Legality and propriety of CESTAT's non-speaking order.
2. Correctness of CESTAT's remand for fresh adjudication on new grounds without departmental views.
3. Finality of the issue regarding exciability and dutiability of RFO used in electricity generation as per the Apex Court's decision.

Issue-Wise Detailed Analysis:

1. Legality and Propriety of CESTAT's Non-Speaking Order:
The appellant questioned the legality of the CESTAT's order, arguing that it was non-speaking and did not address the grounds of appeal filed by the department. The High Court referenced the decision in Nandhi Spinning Mills (P) Limited Vs. The Commissioner of Central Excise, Salem Commissionerate, which emphasized the necessity for the tribunal to discuss the grounds of appeal, evidence, and provide valid reasons for its conclusions. The High Court concluded that the CESTAT's order lacked these elements and was therefore not sustainable, necessitating a remand for a detailed and reasoned order.

2. Correctness of CESTAT's Remand for Fresh Adjudication on New Grounds Without Departmental Views:
The appellant contended that the CESTAT remanded the case for fresh adjudication on the issue of exciability and dutiability of RFO, which was not a ground of appeal and was done without seeking the department's views, violating Rule 10 of CESTAT (Procedure) Rules, 1982. The High Court agreed with the appellant, noting that the tribunal should not rest its decision on new grounds without giving the affected party an opportunity to be heard. The remand order was thus found improper as it introduced a new ground without departmental input.

3. Finality of the Issue Regarding Exciability and Dutiability of RFO Used in Electricity Generation:
The appellant argued that the issue of exciability and dutiability of RFO used in electricity generation had already reached finality with the Apex Court's decision in the taxpayer's own case [2007(211)ELT 93(SC)], which held that RFO used for generating electricity sold outside is dutiable. The High Court noted that the CESTAT's direction to reconsider this settled issue was unnecessary and incorrect. The tribunal should have adhered to the Apex Court's ruling, which had already settled the matter.

Conclusion:
The High Court set aside the CESTAT's order and remanded the matter back to the CESTAT, directing it to issue notice to both parties, provide an opportunity to present their views, and pass a detailed and reasoned order on the appeal. The tribunal was instructed to dispose of the appeal expeditiously, considering the prolonged duration of the proceedings initiated in 2002. The Civil Miscellaneous Appeal was allowed, with no costs awarded.