2022 (2) TMI 1172 - AT - Service Tax

Rectification of mistake - typographical error - first appellate authority denied to consider rectification - Refund of accumulated CENVAT credit - HELD THAT - It is pointed out in the appeal memorandum that the first appellate authority, instead of specifying that the consequence of his findings was allowing of the appeal to the extent of ₹ 49,86,362/-, held as ineligible by the original authority, erred in stating it to be ₹ 45,94,327 for which the appellant had, vide, letter dated 15th January 2019, sought the intervention of the office of the appellate authority to set right - The refund releasing authority, in order dated 31st January 2019, did not consider it appropriate for the differential amount to be disbursed prompting this appeal for setting right the order of the first appellate authority. The disinclination on the part of the first appellate authority to consider rectification that does not compromise the intent of his order is inexplicable. It is certainly not the attitude expected of a senior functionary who is tasked with statutory empowerment to be discharged in a responsible and responsive manner. To offer the hapless appellant gratuitous advice of appellate recourse to the Tribunal is adding insult to injury. Heeding that advice, the assessee is before us with consequent expending of time and effort on the part of the Tribunal. Unless a serious, and punitive, view is taken of this episode, we encourage opening the floodgates of such upward delegation that is inimical to public interest. Cost of ₹ 5000, to be paid into the account of the Maharashtra Legal Aid Services Authority, is imposed on the officer concerned to be identified by the Commissioner of Customs (Appeals) upon due inquiry to fix responsibility for the lapse. The Tribunal, though not entrusted with responsibility for rectification of typographical/clerical errors in orders of lower authorities, cannot justify its existence within the judicial edifice in turning away an appellant, who is in conformity with the prescriptions of section 35B of Central Excise Act, 1944, from the portals of justice - the matter is remanded back to the first appellate authority for correction of such errors as are to be rectified.

Summary

Issues:
Refund of accumulated CENVAT credit, rectification of order-in-appeal, eligibility of refund, rectification of typographical/clerical error, responsibility of appellate authority, imposition of costs, remand of matter to first appellate authority.

Refund of Accumulated CENVAT Credit:
The appellant, a service provider exporting services, sought refund of accumulated CENVAT credit for three quarters totaling &8377; 111,68,281. The original authority sanctioned a partial refund and rejected the rest, directing recovery of the rejected amount with interest. The first appellate authority re-determined the eligibility, partially allowing the claim but did not explain the exclusion of a specific amount. The appellant sought rectification of the error, which was initially declined by the appellate authority, leading to the appeal.

Rectification of Order-in-Appeal:
The appellant challenged the order-in-appeal due to a typographical/clerical error made by the first appellate authority. The error resulted in confusion regarding the amount eligible for refund. Despite the appellant's request for rectification, the appellate authority did not address the issue appropriately, prompting the appeal to rectify the order.

Eligibility of Refund:
The first appellate authority erred in specifying the eligible refund amount, causing confusion for the appellant. The appellant sought intervention to rectify the error, but the authority did not take corrective action. The Tribunal emphasized the responsibility of the appellate authority to rectify errors without unnecessarily burdening the appellant with further legal recourse.

Rectification of Typographical/Clerical Error:
The Tribunal highlighted the importance of rectifying typographical/clerical errors in orders of lower authorities to ensure justice for appellants. Despite not being directly responsible for such rectifications, the Tribunal cannot turn away appellants who comply with statutory provisions. The matter was remanded to the first appellate authority for correction of errors requiring rectification.

Responsibility of Appellate Authority and Imposition of Costs:
The Tribunal criticized the first appellate authority for its disinclination to rectify errors that did not compromise the order's intent. The Tribunal imposed a cost of &8377; 5000 on the officer responsible for the lapse, emphasizing the need for responsible and responsive behavior from senior functionaries to avoid unnecessary legal proceedings and burden on appellants.

In conclusion, the judgment addressed the issues of refund eligibility, rectification of order-in-appeal errors, responsibility of the appellate authority, and the imposition of costs. The Tribunal emphasized the importance of rectifying errors promptly to ensure justice for appellants and discourage unnecessary legal recourse.