2021 (10) TMI 486 - AT - Service Tax

Refund of CENVAT Credit - time limitation - rejection for want of any evidence being produced by the appellant showing compliance of proviso to sub-rule (2) of Rule 5 of CENVAT Credit Rules, 2004 - section 35 of Central Excise Act, 1944 with Section 83 of Finance Act - HELD THAT - Perusal makes it clear that period of 60 days has to reckon from the date of the communication of decision / order to the person aggrieved of the such decision/ order. Mode of communication is prescribed under Section 37C of the Act - bare perusal of sub clause (a) of section 37C clarifies that decision/ orders/ summons/ notices have to be sent by registered post with acknowledgement due to the person for whom it is intended. Joint reading of sections 35 and 37C makes it abundantly clear that it is date of receipt of dispatch in such modes as prescribed under section 37C, CEA which that is relevant for the reckoning the date period of limitation prescribed therein. The Order-in-Original was announced on 19.4.2017 after affording an opportunity of personal hearing to the appellant on 22.02.2017. However, it is mentioned on behalf of the appellant that there was no subsequent intimation to the appellant about the status of the adjudication post 22.02.2017. Accordingly, the appellant had to file a letter on 4.01.2019 requesting for the status thereof - all the submissions have been rejected by the Commissioner (Appeals) holding that there is no evidence on record to show that the appellant has not received the impugned order. This finding is not sustainable because evidence required by the learned Commissioner (Appeals) will be the evidence proving the negative fact. It is not permissible in the eyes of law. It is otherwise settled provision of law that burden was upon the dispatcher to prove that the documents/ orders / summons/ notice etc. was not merely dispatched but was duly received by the recipient. Apparently and admittedly, there is no such evidence on record which may prove the receipt of Order-in-Original to the appellant within the statutory period required for filing the appeal before the Commissioner (Appeals). Rather it is apparent that it was because of the appellants own efforts that the copy of Order-in-Original could be received by the appellant on 03.07.2019. The appeal before Commissioner (Appeals) was filed on 29.08.2019, i.e. very much within the period of 60 days as required under Section 35 of Central Excise Act - the appeal was filed within the statutory period from the date of receipt of Order-in-Original. Commissioner (Appeals) has observed to have committed an error while calculating the period of limitation from the date of Order-in-Original. There is also failure observed on part of the Department for not dispatching the order-in-original properly through the prescribed mode till it was precisely demanded by the appellant. This matter to Commissioner (Appeals) requiring him to decide the matter on merits - appeal allowed by way of remand.

Summary

Issues:
Challenge to rejection of refund claim under Rule 5 of CENVAT Credit Rules, 2004 based on limitation period.

Analysis:
1. The appellant contested the rejection of their refund claim under Rule 5 of CENVAT Credit Rules, 2004, citing a lack of evidence for compliance with the proviso to sub-rule (2). The Order-in-Original rejecting the claim was issued on 19.4.2017, and the appeal was dismissed on grounds of limitation. The appellant argued that they only received the order on 03.07.2019, as confirmed by the department's own letter dated 02.07.2019. They highlighted the delay in receiving information about the adjudication order and emphasized that the rejection was solely based on a presumption of dispatch on 21.4.2017, urging for the order to be set aside.

2. The appellant relied on various legal precedents to support their argument, emphasizing the need for evidence of actual receipt of orders for calculating the period of limitation. The Departmental Representative, however, contended that the order under challenge was legally sound and that the burden was on the appellant to prove non-receipt immediately after the original order. The Commissioner (Appeals) was criticized for not considering the delayed receipt of the order and was urged to dismiss the appeal.

3. The Tribunal analyzed the relevant provisions under Section 35 of the Central Excise Act, 1944 and Section 83 of the Finance Act. It was noted that the period of 60 days for filing an appeal starts from the date of communication of the decision or order. The mode of communication, as per Section 37C of the Act, requires sending orders by registered post with acknowledgment due. The Tribunal referred to past decisions emphasizing the necessity of actual delivery, not just dispatch, for calculating the limitation period.

4. Considering the facts of the case, the Tribunal found that the appellant received the Order-in-Original on 03.07.2019, after efforts to ascertain its status. The appeal before the Commissioner (Appeals) was filed on 29.08.2019, within the statutory 60-day period. The Commissioner (Appeals) was faulted for miscalculating the limitation period and the Department for not dispatching the order properly. The Tribunal concluded that the appeal was filed within the required timeframe and set aside the order under challenge, remanding the case to the Commissioner (Appeals) for a decision on merits.

5. The Tribunal's decision highlighted the importance of actual receipt, not just dispatch, of orders for calculating the limitation period. It underscored the burden on the sender to prove delivery and the necessity of following prescribed modes of communication. The case was remanded for a fresh decision on the merits, emphasizing the need for a fair assessment beyond procedural issues.