2023 (7) TMI 579 - AT - Central Excise

Violation of judicial discipline - reopening and review of previous Tribunal Order for subsequent period - while the accepting the order of tribunal for the earlier periods, SCN issued for the subsequent period involving the same issue - recovery of erroneous refund - whether the Department can reopen and review the order of the Tribunal, by way of a show cause notice on the grounds that refund granted was erroneous, where no appeal was filed against the order of the Tribunal? HELD THAT - The Tribunal s order which attained the finality by not filing an appeal was not implemented in spirit and a review process has been initiated through the back door by issuance of a show cause notice. This is clearly against the principles of judicial discipline. In case, the protective demand was issued before the finalization of the appeal by CESTAT, it was within the permissible limits of the Department to withdraw the same. It is found that the Original Authority vide OIO No.25-35/2020 dated 21.09.2020 has rightly discharged the same - Commissioner (Appeals) cannot sit in judgment of the Tribunal s order and to hold the same to be issued per incuriam , whereas no appeal has been filed against the CESTAT Order and an appeal filed earlier on a case involving identical issue was withdrawn on monetary grounds. It is curious to note that whereas some 10 to 12 orders were passed on the issue against the very same appellant covering the periods before and after the period covered in the impugned order. The Revenue contends that there is no estoppel in Revenue s matter. Maybe it so, it s not open to the Department to open up a case which attained finality. In passing an order contrary to the order of the CESTAT and holding that the CESTAT order was per incuriam , learned Commissioner (Appeals) has exceeded his brief. Moreover, in the instant case, it is found that the Department has followed pick and choose method making a joke of the judicial process and putting the appellant to unwarranted hardship by refraining from appealing past and future cases and selecting only case for review. The finding of the Commissioner as regards the applicability of the provisions of Section 11B to the facts of the case are incorrect and are as a result of incoherent reading of the provisions of the statute. The impugned order is set aside and the appeal is allowed.

Summary

Issues involved:
Violation of judicial discipline in challenging impugned order dated 18.08.2017 passed by Commissioner (Appeals), Guntur regarding refund claim for excess payment of duty. Department's appeal, protective demand, review process, and reopening of Tribunal's order without filing an appeal.

Violation of judicial discipline:
The case involved a challenge to the impugned order dated 18.08.2017 passed by Commissioner (Appeals), Guntur, regarding a refund claim for excess payment of duty. The Department filed an appeal before CESTAT, which was dismissed, and a protective demand was issued on the ground that an appeal was filed against the CESTAT order. The Adjudicating Authority dropped the proceedings, but a review was initiated, leading to the impugned order dated 15.07.2022.

Reopening of Tribunal's order without filing an appeal:
The main issue was whether the Department could reopen and review the Tribunal's order without filing an appeal. Despite the CESTAT order not being challenged, a show cause notice was issued seeking to recover the erroneously refunded duty. The lower authority discharged the notice, but the Commissioner (Appeals) upheld the Revenue's contention on merits and deemed the Tribunal's order as "per incuriam."

Merits of the case and applicability of Section 11B:
The appellant contended that they were eligible for a refund under Section 11B of the Central Excise Act, 1944, as they had not passed on the duty burden. The Department's multiple reviews against the same cause of action were deemed impermissible. The Tribunal had previously discussed the issue on merits and concluded that the appellants were eligible for a refund.

Decision:
The impugned order was set aside, and the appeal was allowed with consequential relief, if any, as per law. The Tribunal highlighted the importance of upholding judicial discipline and respecting the finality of orders, emphasizing that the Department cannot selectively review cases without proper legal grounds.