2015 (1) TMI 87 - AT - Service Tax

Application for intervention - Permission for appointment as necessary party - demand of tax in the case would affect their right and business liability - Held that - present applicant had not approached the Adjudicating authority. Therefore, we do not find any force in the application filed by the applicant. applicant cannot be treated as aggrieved party under Section 86 of the Finance Act, 1994 merely on the ground that the assessee - the Port Department, raised a demand on them relating to demand of tax arising out of the impugned order against which the Port Department filed an appeal - Decided against Appellant.

Summary

Issues:
Application for intervention in an appeal related to service tax demand. Interpretation of provisions for intervention under the Central Excise Law. Claim of double taxation and business liability. Jurisdiction of the Civil Court in matters related to Central Excise Act.

Analysis:
The case involved an application for intervention in an appeal concerning service tax demand. M/s. Karaikal Port Pvt. Ltd. sought to be a necessary party in an appeal filed by the Port Department, Govt. of Puducherry, as their interest was impacted by the tax demand. The applicant argued that they should be allowed to intervene based on Order 1 Rule 8A of the Civil Procedure Code, citing precedents where intervention was permitted on questions of law. However, the Tribunal noted that there was no provision in the CESTAT Rules or Central Excise Law for intervention in appeals.

The Tribunal examined the provisions of the Finance Act, specifically Section 86, which allows appeals against orders passed by Central Excise Officers or the Commissioner (Appeals). It was emphasized that the "person aggrieved" under Section 86 would be the one saddled with the liability, which in this case was the Port Department. Since the applicant had not approached the Adjudicating authority and was not directly liable under the impugned order, their application for intervention was deemed without merit.

Referring to legal precedents, including a Supreme Court case and a Calcutta High Court decision, the Tribunal highlighted that challenges to tax demands should be made by the party directly liable for the tax. The judgments emphasized that the aggrieved party, in this case, the Port Department, should avail themselves of statutory remedies provided under the Finance Act. The Tribunal concluded that the applicant could not be considered an aggrieved party merely due to the demand of tax by the Port Department, and thus rejected their application for intervention.

In light of the detailed analysis of the legal provisions and precedents, the Tribunal held that the applicant's claim for intervention lacked legal merit. The decision underscored the importance of direct liability in challenging tax demands and reiterated the need for aggrieved parties to utilize statutory remedies provided under the relevant laws. The judgment clarified the limitations on intervention in appeals related to tax matters and upheld the principles of legal interpretation in such cases.