2019 (9) TMI 283 - AT - Service Tax

Validity of remand order - Refund claim of excess amount - cum-tax benefit - case of appellant is that this is a case of gross negligence on the part of the Departmental Officer who in spite of so many representations made by him did not fix the personal hearing and did not determine the amount of refund which is due to the appellant from the Department. HELD THAT - The Commissioner (Appeals) vide his order dated 03.08.2012 has given cum-tax benefit to the appellant and the said benefit was to be determined after proper verification by the jurisdictional officer. Further, the Commissioner (Appeals) has also dropped the penalty by resorting to Section 80 of the Finance Act, 1994. After the decision of the Commissioner (Appeals), the appellant has been writing various letters to various Departmental Officer for proper verification as per the directions of the Commissioner (Appeals) but none of the officers bothered to comply with the order of the Commissioner (Appeals) and they have been delaying the matter without any proper reasons. The appellant has placed all the letters on record which clearly shows that he has been pressing and requesting the Departmental Officer to comply with the order of the Commissioner (Appeals) but no Departmental Officer did the proper verification and thereafter the appellant himself filed the refund application on the basis of their calculation. Further, when the refund application was filed, the Departmental Officer without issuing the show-cause notice straightaway rejected the same on time-bar which is not tenable in law. Since the refund application has been rejected without issuing show-cause notice which is not sustainable in law and therefore I set aside the impugned order by allowing the appeal of the appellant with consequential relief, if any.

Summary

Issues:
- Appeal against order remanding the matter to adjudicating authority.
- Delay in granting personal hearing by Department.
- Rejection of refund application as time-barred without show-cause notice.

Analysis:
- The appeal was filed against an order remanding the matter to the adjudicating authority by the Commissioner (Appeals). The appellant, engaged in Mining, Construction, and Transportation Services, received a demand notice for service tax. The appellant deposited a reduced amount after an Order-in-Original and filed an appeal. Despite repeated requests, the Department did not grant a personal hearing, leading to delays. The appellant later sought a refund, which was rejected as time-barred by the Assistant Commissioner. The Commissioner remanded the case back to the adjudicating authority, prompting the present appeal.

- The appellant argued that the impugned order was unsustainable due to the Department's negligence in not fixing a personal hearing or determining the refund amount. The appellant cited instances of Departmental Officers passing responsibility and delaying proceedings for four years. The appellant contended that the refund application rejection without a show-cause notice was against the law. Legal precedents were cited to support the appellant's arguments, emphasizing the Department's duty to refund excess amounts post-appeal conclusion.

- The Tribunal, after hearing both parties and reviewing the records, noted the Commissioner (Appeals) had granted cum-tax benefit and dropped the penalty, directing proper verification by the jurisdictional officer. The Tribunal observed the Department's failure to comply with the Commissioner's directions, leading the appellant to file a refund application based on their own calculations. The rejection of the refund application without a show-cause notice was deemed legally untenable. Relying on legal precedents, the Tribunal set aside the impugned order, allowing the appeal with any consequential relief.

- The Tribunal's decision highlighted the Department's obligation to follow appellate orders, conduct proper verifications, and issue show-cause notices before rejecting refund applications. The appellant's persistence in seeking compliance with the Commissioner's directions was acknowledged, leading to the appeal's success based on legal principles and precedents cited during the proceedings.