2024 (6) TMI 580 - HC - Central Excise

Rectification of order by the CESTAT - Rejection of application filed u/s 35C (2) of the Central Excise Act, 1944 - discount received by bank from automobile dealers can be treated as a consideration for service or not - HELD THAT - The decision in case of IndusInd Bank Ltd. 2019 (2) TMI 26 - CESTAT CHENNAI was rendered even without taking note of any of the decisions rendered earlier by the benches of co-equal strength and such a decision cannot be but a decision rendered per incuriam. What is quite glaring is that the Tribunal has not bothered to list which are those matters prior to IndusInd Bank Ltd., where a contrary view has been taken and which are those matters which have not been considered in the IndusInd Bank Ltd. It is nothing but a bald observation made without details. Apart from mere assertion, there is no mention in the impugned order of any decision of the Appellate Tribunal, which has taken a contrary view. The impugned order passed by the Tribunal on 5th December 2019 has to be quashed and set aside. The matter is remanded to the Tribunal for denovo consideration - application disposed off.

Summary

Issues:
1. Impugning order of Customs Excise and Service Tax Appellate Tribunal
2. Application under Section 35C (2) of the Central Excise Act, 1944 rejected
3. Grounds raised citing judgment by Chennai Tribunal
4. Tribunal's rejection based on irrelevant facts and per incuriam decision
5. Lack of proper reasoning in Tribunal's order
6. Quashing the impugned order and remanding the matter for denovo consideration
7. Request for disposal of Miscellaneous Application by a specified date
8. Withdrawal of Central Excise Appeal with liberty to file a fresh appeal

Analysis:
The petitioner challenged the order of the Customs Excise and Service Tax Appellate Tribunal, which rejected their application under Section 35C (2) of the Central Excise Act, 1944. The petitioner contended that their case aligned with a judgment by the Chennai Tribunal, emphasizing that the discount received by the petitioner from automobile dealers should not be considered as a consideration for service. However, the Tribunal's rejection was based on the premise that irrelevant facts and arguments need not be included in the order, and the Chennai Tribunal's decision was rendered per incuriam. The Tribunal failed to provide a detailed analysis of prior decisions or contradictory views, leading to a lack of proper reasoning in the order.

The High Court emphasized that judicial authorities must provide proper reasons for their conclusions, citing the importance of clarity in orders as established by the Apex Court. Consequently, the High Court quashed the Tribunal's order and remanded the matter for denovo consideration, emphasizing the need for a well-reasoned decision. The Court granted the petitioner's request for a writ of mandamus to quash the impugned order and directed the Tribunal to reexamine the matter thoroughly.

Additionally, the Court requested the Tribunal to expedite the disposal of the Miscellaneous Application, setting a deadline for resolution. In a separate Central Excise Appeal, the petitioner sought to withdraw the appeal with liberty to file a fresh appeal if necessary, which was granted by the Court. Overall, the judgment focused on the importance of providing detailed reasons in judicial decisions and ensuring a thorough examination of the issues at hand.