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2014 (4) TMI 884 - HC - Service TaxDenial of refund claim - Whether appeal u/s 86 lies before the tribunal or revision to be filed before the government - Jurisdiction of tribunal - Revenue contends that a specific reference of Section 35EE (of the Central Excise Act) precluded an appeal under Section 86, and that the remedy available to the assessee was a revision to the Central Government - Held that - Parliament always intended that an appellate remedy should be available in respect of refund and rebate claims. That power was exercisable by the CESTAT. The amendment of Section 83, in 2012 did not disturb the appellate remedy, i.e Section 86; the amendment did not limit the appellate power in any manner whatsoever. It is a settled position of law that exclusion of jurisdiction of courts and tribunals should be by way of express provisions, or through necessary intendment. - amendment to Section 83 by making a specific reference to Section 35EE of the Central Excise Act, did not make any difference to the nature of jurisdiction exercisable by the CESTAT under Section 86; it continued to possess jurisdiction to decide on matters pertaining to rebate and refund. Since CESTAT did not decide the matter on merits, its decision holding that it lacked jurisdiction- is set aside. The CESTAT shall consequently decide the merits of the appeal pending before it, after hearing the parties. - Decided in favor of assessee.
Issues Involved:
1. Maintainability of appeal before CESTAT regarding refund and rebate claims. 2. Interpretation of Section 35EE of the Central Excise Act in relation to Section 83 and Section 86 of the Finance Act, 1994. 3. Jurisdiction of CESTAT vis-`a-vis the Central Government's revisional authority. Detailed Analysis: 1. Maintainability of Appeal Before CESTAT: The petitioner challenged the decision of the Central Excise Service Tax Appellate Tribunal (CESTAT), which ruled that an appeal concerning refund and rebate claims is not maintainable before it due to the specific mention of Section 35EE of the Central Excise Act in Section 83 after its amendment in 2011. The Tribunal concluded that the appellate remedy under Section 86 was barred, and the appropriate remedy was a revision to the Central Government. 2. Interpretation of Section 35EE of the Central Excise Act in Relation to Section 83 and Section 86 of the Finance Act, 1994: The Tribunal reasoned that Section 35EE's incorporation into Section 83 of the Finance Act was intended to ensure that the object of Section 35EE was not defeated by Section 86. The Tribunal emphasized that the legislature did not intend to make redundant the provisions of the Central Excise Act incorporated into the Finance Act. It asserted that the adoption of relevant provisions was meant to govern the administration of service tax law and that Section 35EE could not be read as redundant or otiose. The Tribunal concluded that the appellate jurisdiction under Section 86 could not operate independently of Section 83, and the substantive right of revision in respect of rebate claims was to be entertained by the revisional authority under Section 35EE. 3. Jurisdiction of CESTAT vis-`a-vis the Central Government's Revisional Authority: The Tribunal analyzed the nature of rebate and refund claims, stating that adjudication of rebate claims might grant certain concessions or result in no levy, potentially leading to a refund of tax paid on input services used in export of services. It concluded that the admissibility of rebate under the relevant notification was to be decided by the revisional authority without denying the right to redressal under Section 83, read with Section 35EE. The Tribunal held that the inclusion of Section 35EE in Section 83 did not take away the right of redressal but merely located it through a different jurisdiction, i.e., revision by the Central Government. Arguments by Petitioner and Respondent: The petitioner argued that the inclusion of Section 35EE did not alter the appellate remedy under Section 86 and that the reference to various provisions under Section 83 was meant to borrow the mechanism of the Central Excise Act. The petitioner cited the Karnataka High Court decision in British Physical Laboratory to support its contention. The respondent argued that the inclusion of Section 35EE removed the appellate remedy and conferred revisional jurisdiction upon the Central Government. The respondent emphasized that not endorsing the Tribunal's conclusions would render Parliamentary intent in including Section 35EE useless. Court's Conclusion: The court held that the amendment to Section 83 by making a specific reference to Section 35EE did not affect the jurisdiction exercisable by the CESTAT under Section 86. The court stated that the exclusion of jurisdiction of courts and tribunals should be by express provisions or necessary intendment, as established in Subal Paul v. Malina Paul & Anr. The court concluded that the CESTAT continued to possess jurisdiction to decide on matters pertaining to rebate and refund. Consequently, the court set aside the CESTAT's decision, which held that it lacked jurisdiction, and directed the CESTAT to decide the merits of the appeal pending before it after hearing the parties. The appeal was allowed without any order as to costs.
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