2014 (5) TMI 182 - HC - Service Tax

Difference of opinion between members of tribunal - difference of opinion on facts - manner in which issues to be addressed - Held that - It is expected that Member (Technical) and Member (Judicial) work in coordination and in tandem. They ought to match their experience in their respective fields, their expertise in rendering a quality judgment. This harmony and order has to be maintained on the Bench and in all causes. The Tribunal Members should bear in mind that litigants would suffer and eventually justice would be a casualty if there are frequent differences of opinion resulting in matter being referred to a third Member. The experience shows that virtually the same members assemble for work day in and day out. If there is lack of cordiality and co-operation between them, then, the composition of the Tribunal itself may have to be altered. It is not possible and frequently to replace members or alter the composition of benches. The President is not expected to address such issues repeatedly. In these circumstances, we expect a better understanding and coordination between the members manning this Tribunal. At one time this Tribunal was known for its professionalism and expertise. The decisions were rendered efficiently and quickly. It was one of the best Tribunals and its example was cited even during the course of imparting training to the Judicial Officers at Academies. Its working resulted in saving time and costs. Further, both the Revenue and Assessee knew where they stand in terms of the Applicability of Tax laws. That serves larger Public Interest and guarantees Economic Justice to all. We would now at least expect the Tribunal to work in a manner so as to uphold the object and purpose of the Act. It may not to be out of context if we remind the members of the Appellate Tribunal of the practice, tradition Customs followed over decades by the Judges and which have been referred by the Hon ble Supreme Court in several judgments. We are not at all critical of the manner in which the Tribunal is functioning and working. We are aware of the fact that at times large number of cases take a toll on the Judicial Officers or the Members. Pressure of work and docket explosion requires one to work tirelessly. However, Cordiality, Co-operation, Courtesy and respect for each other s view would assist in avoiding divergence of opinion on factual issues. If the view held by the other is possible, then, nothing is lost in going by it and if that furthers the cause of justice. To avoid differences of opinion on Mixed and purely factual matters, to foster the spirit of brotherhood and uphold judicial fraternity that we have invited the attention of all concerned to the above Judgment of the Supreme Court. Beyond that we may not be understood to have said anything and in disapproval. Debate resolves but dissent is unending at times. The word Comrade as defined in the concise Oxford Dictionary means a workmate, friend or companion . The word and spirit need not be forgotten even by Judges and Adjudicating Bodies. We should continue the debate, dialogue, discussion and deliberation but differ rarely and in exceptional cases, with dignity.

Summary

Issues Involved:
1. Difference of opinion between Tribunal members.
2. Rectification of mistake application.
3. Applicability of extended period of limitation.
4. Reference to a third member.
5. Comparison with another case (M/s. Datamani Technologies India Ltd.).
6. Maintainability of the rectification application during the pendency of a reference.
7. Procedural and jurisdictional aspects of the Tribunal's decision-making process.

Detailed Analysis:

1. Difference of Opinion Between Tribunal Members:
The case highlights a significant issue where the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) members (Judicial and Technical) had differing opinions on the merits of the case. The Member (Judicial) believed the appellant's activities did not fall under "Business Auxiliary Services," while the Member (Technical) disagreed, stating the services rendered were taxable under this category and justified the invocation of the extended period for demand of Service Tax.

2. Rectification of Mistake Application:
The appellant filed a rectification of mistake application, arguing that the Tribunal's original order incorrectly referenced another case (M/s. Datamani Technologies India Ltd.) and did not consider the specific facts of their case. The Tribunal dismissed this application, stating that the issue was not an apparent mistake but a matter for the third member to decide.

3. Applicability of Extended Period of Limitation:
The Member (Technical) opined that the extended period of limitation was rightly invoked due to the appellant's suppression of facts. This aspect was not addressed by the Member (Judicial), leading to a point of contention that required resolution by a third member.

4. Reference to a Third Member:
The Tribunal framed the question for the third member to decide whether the appellant's activities constituted "Business Auxiliary Services" and whether the extended period of limitation was applicable. The High Court emphasized that the third member should consider the specific facts of the appellant's case, not just those of M/s. Datamani Technologies India Ltd.

5. Comparison with Another Case:
The appellant argued that their case was distinct from M/s. Datamani Technologies India Ltd., and the Tribunal should have considered their specific facts. The High Court supported this view, stating that the third member should differentiate between the cases and not solely rely on the facts of the other case.

6. Maintainability of the Rectification Application During Pendency of Reference:
The High Court acknowledged the maintainability of the rectification application even during the pendency of a reference to a third member, as established in the case of "Suzlon Infrastructure Ltd. Vs. Union of India (UOI) and Ors."

7. Procedural and Jurisdictional Aspects:
The High Court clarified that the power of rectification is not akin to a review but is limited to correcting apparent mistakes. It emphasized the importance of judicial discipline and the need for Tribunal members to work in harmony to avoid frequent differences of opinion, which can delay justice and affect the administration of tax laws.

Conclusion:
The High Court dismissed the appeal, stating it did not raise any substantial question of law. The Tribunal's decision to refer the matter to a third member was upheld, with the expectation that the third member would consider the specific facts of the appellant's case. The judgment also highlighted the need for judicial collegiality and efficiency in the Tribunal's functioning to ensure timely and just resolution of tax disputes.