2020 (11) TMI 31 - SC - Service Tax

Withdrawal of affidavit of valuation - Section 35L of the Central Excise Act, 1944 - HELD THAT - Inasmuch as the operative portion of the order of CESTAT, which is under appeal, imposes a financial liability on the appellant, the affidavit of valuation that accompanied the appeals was in order and the request of the appellant to withdraw the affidavit so as to confine the Court Fee to the fixed amount of ₹ 10,000/- may not be legally sustainable. The appeal against Registrar Court s order is dismissed.

Summary

Issues:
1. Correctness of Registrar's order rejecting withdrawal of affidavit of valuation.
2. Challenge to final order passed by CESTAT under Central Excise Act, 1944.

Issue 1: Correctness of Registrar's order rejecting withdrawal of affidavit of valuation
The appellant filed appeals questioning the Registrar's order rejecting the request to withdraw the affidavit of valuation. The CESTAT's order confirmed the demand under Sec.73A(3) of the Central Excise Act, 1944, with respect to service tax collected from clients. It also addressed the demand of interest under Sec.73B and reversal of ineligible CENVAT credit. The CESTAT's order imposed financial liabilities on the appellant, leading to the rejection of the request to withdraw the affidavit of valuation to limit the Court Fee to a fixed amount. The Supreme Court found the request to withdraw the affidavit not legally sustainable, given the financial implications of the CESTAT's order. Consequently, the appeal against the Registrar Court's order was dismissed.

Issue 2: Challenge to final order passed by CESTAT under Central Excise Act, 1944
The appellant challenged the final order passed by CESTAT on 16.01.2019 under Section 35L of the Central Excise Act, 1944. The CESTAT's order confirmed the demand for service tax collected from clients, set aside the interest demand under Sec.73B, and confirmed the reversal of ineligible CENVAT credit. Additionally, interest under Rule 14 of CCR was confirmed for the period between credit taking and reversal. The order also set aside all penalties under Sec.80 of the Finance Act, 1994. The appeal was disposed of based on the operative portion of the CESTAT's order imposing financial liabilities on the appellant, leading to the dismissal of the appeal against the Registrar Court's order rejecting the withdrawal of the affidavit of valuation.

This detailed analysis highlights the legal intricacies involved in the Supreme Court's judgment, addressing the correctness of the Registrar's order and the challenge to the final order passed by CESTAT under the Central Excise Act, 1944.