2018 (8) TMI 455 - AT - Central Excise

Recovery of CENVAT Credit with Interest and penalty - Illegal availment and utilization of input service credit on service tax on Commission paid - Held that - The Commissioner (Appeals) should decide the matter afresh taking into account the points raised by the Revenue in their grounds of appeal. Accordingly, the matter is remitted back to the Commissioner (Appeals) of Customs to consider the grounds of appeal filed by the Revenue and to pass the order in accordance with law - appeal allowed by way of remand.

Summary

Issues:
Appeal against Order-in-Appeal dated 16.02.2016 - Alleged illegal availment and utilization of input service credit on service tax - Adjudication confirming demand of recovery of cenvat credit - Imposition of penalty - Appeal allowed by Commissioner (Appeals) - Revenue's appeal before the Tribunal.

Analysis:
The appeal before the Appellate Tribunal CESTAT Kolkata involved a case where a Show Cause Notice was issued to the respondent assessee for the period August 2009 to March 2014 regarding the alleged illegal availment and utilization of input service credit on service tax. The notice was specifically related to commission paid on the basis of order volume to a third party acting as a commission agent on behalf of the assessee. The adjudicating authority had confirmed the demand for recovery of cenvat credit amounting to ?25,47,213, along with interest and penalties as per the provisions of Section 11A(2) and Section 11A(10) of the relevant statutes.

Upon appeal, the Commissioner (Appeals) reversed the adjudication order, setting it aside. This led to the Revenue filing an appeal before the Tribunal challenging the decision of the Commissioner (Appeals). During the proceedings, the ld.A.R. for the Revenue presented submissions, following which the Tribunal, through Shri P.K. Choudhary, Judicial Member, decided to remit the matter back to the Commissioner (Appeals) for a fresh consideration. The Tribunal emphasized that the Commissioner (Appeals) should take into account the points raised by the Revenue in their grounds of appeal and pass an order in accordance with the law. It was also directed that the respondent should be given a reasonable opportunity of hearing in this regard.

Ultimately, the appeal filed by the Revenue was allowed by the Tribunal through a remand order, indicating that the matter needed further consideration and decision by the Commissioner (Appeals). The operative part of the order was pronounced in the open court, highlighting the decision to remit the case back for reevaluation and a fresh decision by the Commissioner (Appeals).