2021 (12) TMI 479 - HC - Central Excise

Effect of superceded notification - Whether the Customs, Central Excise and Service Tax Appellate Tribunal ought to have followed its own decision in Mahindra Engineering Services Ltd. vs. Commissioner of Central Excise, Pune-I 2015 (1) TMI 457 - CESTAT MUMBAI especially when the same was after considering the effect of Notification No.9/2009 which now has been superceded by Notification No.12/2013 which is applicable in the facts of the present case? - HELD THAT - The Tribunal in M/S MAHINDRA ENGINEERING SERVICE LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, PUNE-I 2015 (1) TMI 457 - CESTAT MUMBAI while considering the effect of Notification No.09/2009 held that said Notification did not require the approval from the Approval Committee to be obtained prior to providing the services in question. It also noted that the refund claimed therein had been filed after approval was granted by the Approval Committee. This was held to be sufficient compliance with the requirements of Notification No.09/2009. The appellant before the Tribunal had also raised a contention that the conditions of Notification No.09/2009 were similar to the conditions in Notification No.12/2013. The impugned order of the Tribunal does not consider the latter contention raised by the appellant for if that contention were to be accepted by the Tribunal, it either ought to have followed its earlier view in Mahindra Engineering Services Ltd. 2015 (1) TMI 457 - CESTAT MUMBAI or if it was not inclined to do so, it ought to have referred the question to a larger bench as held in Mercedes Benz (India) Pvt. Ltd. 2010 (3) TMI 300 - BOMBAY HIGH COURT . Even otherwise we find that merely because a particular argument was not raised when the earlier proceedings were decided would not be a sufficient ground to disregard an earlier adjudication made on merits. Re-consideration of the proceedings by the Tribunal is warranted - proceedings are remanded to the Tribunal to decide the appeal afresh on its own merits and in accordance with law - Appeal allowed by way of remand.

Summary

Issues:
- Interpretation of Notification No.12/2013 for refund claim under Central Excise Act, 1944.
- Applicability of earlier Tribunal decision in Mahindra Engineering Services Ltd. case.
- Consideration of conditions for claiming benefit under Notification No.12/2013.

Analysis:

Issue 1: Interpretation of Notification No.12/2013
The case involved a Company seeking a refund of service tax under Notification No.12/2013 for services provided by a contractor. The appellant argued that there was no requirement of prior Approval Committee approval under Condition 3(1) of the notification. The respondent contended that all conditions had to be fulfilled for claiming the benefit of the exemption. The Court analyzed the provisions of the notification and held that the Tribunal's decision was not justified in disregarding its earlier order and should have considered the effect of Notification No.12/2013 in granting the refund claim.

Issue 2: Applicability of Earlier Tribunal Decision
The appellant relied on a previous Tribunal decision in Mahindra Engineering Services Ltd. case, where it was held that approval from the Approval Committee was not required before providing services under Notification No.09/2009. The appellant argued that the facts of this case were similar to the Mahindra case and the Tribunal should have followed its own decision. The Court agreed with the appellant, stating that the Tribunal should have either followed its earlier view or referred the matter to a larger bench for reconsideration.

Issue 3: Consideration of Conditions for Claiming Benefit
The Court noted that the Tribunal failed to consider the appellant's contention that the conditions of Notification No.09/2009 were similar to those in Notification No.12/2013. It emphasized that disregarding an earlier decision on the ground of a particular argument not being raised earlier was not sufficient. The Court held that the Tribunal should have either followed its earlier view or referred the matter to a larger bench for reconsideration, as per legal precedents.

In conclusion, the Court set aside the Tribunal's order, remanded the proceedings for fresh consideration, and directed the Tribunal to decide the appeal expeditiously. The appellant's appeal was allowed, with each party bearing its own costs.