2018 (11) TMI 904 - AT - Central Excise

Jurisdiction - power of Superintendent of Central Excise to adjudicate the matter - SSI Exemption - Held that - It is specifically stated in para 2 clause (i) of circular No. 1049/37/2016-CX dated 29.9.2016 that the Superintendent will not be having jurisdiction to adjudicate case involving taxability, classification, valuation etc. The Commissioner (Appeals) has rightly set aside the Order in Original passed by the Superintendent dated 16.2.2017 holding that Superintendent has no jurisdiction to decide the matter. Though the appellant has put forward arguments on merits of the case also, I find that since the order passed by the Commissioner (Appeals) is confined to the lack of jurisdiction by the Superintendent and the matter having been remanded for reconsideration, the said arguments on merits are premature to be considered at this stage. Appeal dismissed - decided against appellant.

Summary

Issues: Jurisdiction of Superintendent to adjudicate matters of taxability, validity of SSI exemption availed by the appellant, remand order by Commissioner (Appeals)

The judgment involves a dispute where the appellant purchased plant and machinery with raw materials, availing SSI exemption, but the department alleged the previous manufacturer did not avail SSI exemption. The Superintendent initially dropped the demand, but the department appealed, arguing jurisdiction. The Commissioner (Appeals) set aside the Superintendent's order, remanding the case. The appellant contended that since the department did not appeal on merits, the original order should apply. The consultant argued the appellant should be considered an independent manufacturer post-purchase. The department argued the Superintendent lacked jurisdiction on taxability issues. The Tribunal found the Superintendent lacked jurisdiction as per a circular, upholding the remand order, dismissing the appeal, and instructing the AC/DC to re-adjudicate considering the appellant's arguments and case laws cited.

The key issue revolved around the jurisdiction of the Superintendent to decide matters of taxability. The Superintendent's original order was challenged by the department, contending that taxability issues fall outside the Superintendent's jurisdiction. The Commissioner (Appeals) sided with the department, setting aside the original order and remanding the case for re-adjudication by the AC/DC. The Tribunal upheld the Commissioner's decision, citing a circular that limits the Superintendent's jurisdiction regarding taxability, classification, and valuation matters. The Tribunal found that the Superintendent lacked the authority to decide on taxability issues, supporting the remand order.

Another crucial issue was the validity of the SSI exemption availed by the appellant. The appellant argued that since the department did not appeal on merits, the original order should stand, and the demand for duty should not be sustained. The consultant contended that post-purchase, the appellant should be considered an independent manufacturer, and the previous manufacturer's clearances should not be included in the appellant's aggregate value. The Tribunal, however, did not delve into the merits of the case due to the focus on jurisdictional issues. The Tribunal emphasized that the arguments on merits were premature at that stage, upholding the remand order for re-adjudication by the AC/DC.

The judgment also addressed the remand order by the Commissioner (Appeals). The Commissioner's decision to remand the case for re-adjudication by the AC/DC was challenged by the appellant. The Tribunal, after reviewing the records and the arguments presented, upheld the remand order, stating that the Commissioner's decision was appropriate given the jurisdictional limitations of the Superintendent. The Tribunal emphasized that the AC/DC should consider the appellant's arguments and the case laws cited during re-adjudication, thereby dismissing the appeal and affirming the remand order.