2025 (3) TMI 961 - AT - Central Excise

Prayer to remand the issue to be heard on merits by the Lower Appellate Authority - Valid service of notice or not - non-intimating the vacation of the registered premises to the department - HELD THAT - The Appellant has only pleaded to remand the matter to the lower appellate authority for deciding the case on merits. The Ld. Counsel has relied upon the decision of the Hon ble Supreme Court in the case of Saral Wire Craft Pvt. Ltd. Vs. Commissioner of Customs Central Excise and Service Tax and Others 2015 (7) TMI 894 - SUPREME COURT wherein it was held that the order served on an unauthorized person has inevitably led to miscarriage of justice and the specific language of Section 37C(a) of the Act requires that an order must be tendered on the concerned person or his authorized agent in other words on no other person to ensure efficaciousness. In the present case the Order-in-Original No. 23/2016 (AC) dated 15.11.2016 passed by the Assistant Commissioner of Customs Central Excise and Service Tax Salem against which the party has belatedly filed the appeal and which was sent to the earlier leased factory was received by the appellant only on 26.10.2017 and the appellant has filed the above appeal without any further loss of time on 17.11.2017. As such the appeal has been filed in time as there is no compliance with the provisions of Section 37C of the Act and as there is evidence that the copy of the order was served on some other person or servant working in erstwhile company wherein the name was not even mentioned cannot be treated as service of the order. Considering that the Appellant had vacated the premises before the issuance of the Order-in-Original dated 15.11.2016 it is considered appropriate to direct the lower authority to decide the Appellants appeal on merits. The order to be passed shall be a reasoned order dealing with all submissions of Appellant in strict compliance of the principles of natural justice. It is clarified that this order would not absolve the petitioner from its liability to pay taxes if any. Conclusion - The service of the Order-in-Original is invalid and the appeal was not time-barred. The matter is remanded to the lower appellate authority to be decided on merits ensuring compliance with principles of natural justice. The prayer of the Appellant to remand the issue to be heard on merits by the Lower Appellate Authority is allowed.

ISSUES PRESENTED and CONSIDERED

The core legal issues considered in this judgment are:

Whether the Order-in-Original dated 15.11.2016 was validly served on the Appellant under Section 37C of the Central Excise Act, 1944.
Whether the appeal filed by the Appellant before the lower appellate authority was time-barred due to improper service of the Order-in-Original.
Whether the lower appellate authority erred in dismissing the appeal without considering the merits of the case.

ISSUE-WISE DETAILED ANALYSIS

1. Validity of Service under Section 37C of the Central Excise Act, 1944

Relevant legal framework and precedents: Section 37C of the Central Excise Act, 1944, outlines the procedure for serving decisions, orders, summons, etc., emphasizing that service must be on the person for whom it is intended or their authorized agent. The Appellant relied on the precedent set in Saral Wire Craft Pvt. Ltd. vs. Commissioner of Customs, Central Excise and Service Tax, which underscores the necessity of serving orders on the authorized person to avoid miscarriage of justice.
Court's interpretation and reasoning: The Tribunal found that the service of the Order-in-Original was not compliant with Section 37C as it was served on an unauthorized person, a helper at the former premises, rather than the Appellant or their authorized agent.
Key evidence and findings: The Appellant vacated the premises before the issuance of the Order-in-Original, and the order was received by a person not connected to the Appellant's company. The Tribunal noted the lack of evidence that the order was also dispatched by registered post with acknowledgment due.
Application of law to facts: The Tribunal applied Section 37C and relevant precedents to conclude that the service was invalid, as it did not meet the statutory requirements.
Treatment of competing arguments: The Department argued that the Appellant was at fault for not informing about the change of premises. However, the Tribunal emphasized the statutory requirement for proper service, which was not met.
Conclusions: The Tribunal concluded that the service of the Order-in-Original was invalid, leading to a miscarriage of justice.

2. Timeliness of the Appeal

Relevant legal framework and precedents: The appeal process is governed by timelines stipulated in the Central Excise Act, 1944. The Appellant argued for condonation of delay based on improper service, citing the decision in M/s. OSA Shipping Pvt. Ltd., which supports condonation in cases of genuine delay due to non-receipt of orders.
Court's interpretation and reasoning: The Tribunal recognized that the delay was attributable to the improper service of the Order-in-Original, which the Appellant only received after making efforts to obtain a certified copy.
Key evidence and findings: The Appellant filed the appeal promptly upon receiving the order, and had already paid a significant portion of the demanded duty, indicating no intent to delay proceedings.
Application of law to facts: The Tribunal applied principles from relevant case law to find that the delay should be condoned due to the failure in proper service.
Treatment of competing arguments: The Department's position on the time-bar was rejected due to the improper service, which justified the delay.
Conclusions: The Tribunal decided that the appeal was not time-barred and should be heard on its merits.

SIGNIFICANT HOLDINGS

Preserve verbatim quotes of crucial legal reasoning: The Tribunal cited the principle that "if the manner of doing a particular act is prescribed under any statute, the act must be done in that manner or not at all," emphasizing the necessity of serving orders on the intended person or their authorized agent.
Core principles established: Proper service under Section 37C is crucial for the validity of orders and subsequent appeals. Non-compliance with statutory service requirements can lead to a miscarriage of justice.
Final determinations on each issue: The Tribunal concluded that the service of the Order-in-Original was invalid, and the appeal was not time-barred. The matter was remanded to the lower appellate authority to be decided on merits, ensuring compliance with principles of natural justice.

The Tribunal directed the lower authority to reconsider the appeal on its merits, ensuring a reasoned order that addresses all submissions of the Appellant, while clarifying that this decision does not absolve the Appellant from any tax liabilities.

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