2024 (10) TMI 1069 - AT - Service Tax

Interpretation of statute - Section 35A of the Central Excise Act and Section 85 of the Finance Act, 1994 - power of Commissioner (Appeals) to remand the matter back to the original adjudicating authority - HELD THAT - The powers of Commissioner (Appeal) in the matters relating to the Appeal, filed before him under the Central Excise Act, 1944 and under Finance Act, 1994 are identical. Subsection (5) of Section 85, make these powers co-terminus with the powers available under the Central Excise Act, 1994. In view of the Section 35A of CEA, the learned Commissioner (Appeals) is mandated to make such order as he deems just proper, confirming, modifying or annulling the decision or order appealed against. In view of the above said provisions it is deemed to remand the matter to be decided by the learned Commissioner (Appeals) instead of remanding it back to the Original Authority. The said observation is made in interest of justice for the reason that by remanding the matter back to original authority the appellant is forced into another round of litigation at the level of adjudicating authority, which could be avoided and which was the objective of amendments made in Section 35A of the Central Excise Act, 1944 by the Finance Act, 2001. Matter remanded back to the learned Commissioner (Appeals) for a decision within three months from the date of this order - appeal allowed by way of remand.

Summary

Issues:

1. Whether the Commissioner (Appeals) had the authority to remand the matter back to the original adjudicating authority.
2. Interpretation of Section 35A of the Central Excise Act and Section 85 of the Finance Act, 1994.
3. Applicability of previous judicial decisions regarding the power of remand by the Commissioner (Appeals).
4. Determination of the appropriate course of action in the present case.

Analysis:

The judgment revolves around the issue of whether the Commissioner (Appeals) had the power to remand the matter back to the original adjudicating authority. The appellant argued that the Commissioner (Appeals) could not remand the matter back to the original authority based on specific provisions in Section 35A of the Central Excise Act. The Authorized Representative for the Revenue reiterated the findings of the impugned order. The Tribunal analyzed Section 35A(3) of the Central Excise Act and Section 85(4) & (5) of the Finance Act, 1994, highlighting that the powers of the Commissioner (Appeals) in matters of appeal are identical under both acts.

The Tribunal referred to previous judicial decisions to support its analysis. It cited the case of MIL India Ltd., where the power of remand by the Commissioner (Appeals) was withdrawn by an amendment to Section 35A. The judgment in Devansh Exports further clarified the legal position regarding the power of remand before and after the amendment. The Tribunal emphasized that the Commissioner (Appeals) lacks jurisdiction to remand the matter and should decide the case independently.

Based on the legal provisions and precedents, the Tribunal concluded that the matter should have been decided by the Commissioner (Appeals) instead of being remanded back to the original authority. The Tribunal noted that remanding the matter would lead to unnecessary additional litigation, contrary to the objective of the amendments made in Section 35A by the Finance Act, 2001. Therefore, the Tribunal decided to remand the matter back to the First Appellate authority for a decision on merits within a specified timeframe.

In the final order, the Tribunal allowed the appeal and directed the matter to be remanded back to the Commissioner (Appeals) for a decision within a specified period. The appellant was instructed not to seek a refund of any pre-deposit made until the appeal was disposed of by the Commissioner (Appeals). The judgment was dictated and pronounced in open court by the Tribunal.