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TMI BlogHow to file an appeal in Excise.Service taxX X X X Extracts X X X X X X X X Extracts X X X X ..... Sir, Any one can provide complete procedure of how to fill appeal in indirect tax matter. If a person is not from law field. Rgds Yateen vyas - Reply By MARIAPPAN GOVINDARAJAN - The Reply = Dear Sir, Whether you want to know the procedure in general or specific. If specific give the gist of your case. Advice will be given accordingly. Regards, M. GOVINDARAJAN - Reply By yateen vyas - The Reply = Sir, In general sir as i am not from law field so pleae provide your view according to me. Rgds Yateen vyas - Reply By Pradeep Khatri - The Reply = DEMAND/ SHOW CAUSE NOTICE/ ADJUDICATION/ APPEALS Demand/ Show cause notice If the department feels that duty was due on any goods but has not been levied or has been short levied or erroneously refunded, it has the right under section 11A to demand the duty. But before demanding the duty a show cause notice is required to be issued by the Department, asking from the person 'why he should not pay the amount' specified in the notice. Thus show cause notice gives the noticee an opportunity to present his case and than demand will be confirmed giving reasons. Thus, it is mandatory to serve the show cause notice b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore demanding the duty. For e.g. even if assessee had admitted and agreed to pay the duty liability, show cause has to be issued to him. Thus mere endorsing a copy of notice or sending letter asking to pay the duty is not a notice. Also, demand of duty or penalty on a person cannot be confirmed unless a show cause notice is issued to him. However there are some cases, where no show cause notice is served. 'Authority' issuing show cause notice Show cause notice should be issued and signed by the 'Central Excise Officer' empowered to adjudicate the case and powers of adjudication depends upon the amount of duty or Cenvat credit involved on offending goods. Authority to adjudicate Amount of duty/ Cenvat credit AC/ DC Upto Rs. 5 lakhs Joint Commissioner Between Rs. 5 lakhs to Rs. 20 lakhs Additional Commissioner Between Rs. 20 lakhs to Rs. 50 lakhs Commissioner No limit Superintendent Cannot issue show cause notice However, above limit cannot be held as a ground that other officer had no jurisdiction to issue show cause notice, these limits are just administrative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... directions. These administrative directions cannot take away jurisdiction vested with central excise officer. Thus, the notice can be served and demand can be confirmed by any central excise officer. Time limit to issue show cause notice As per section 11A of CEA, 1944 , time limit for issuing Show cause notice in different situations are as follows: - One year from relevant date - where excise duty has not been levied or not paid, short levied or short paid, erroneously refunded. Within five year from relevant date - where excise duty has not been levied or not paid, short levied or short paid, erroneously refunded on account of fraud, collusion, willful mis-statement and suppression of facts. As per section 11A(3) 'Relevant date' means- In case of excisable goods where duty of excise has not been levied or not paid, has been short-levied or short paid - - Where 'Return' required to be filed as per law is filed, relevant date is the 'actual date of filing of return'. - Where 'Return' required to be filed, is not filed, relevant date is the date on which 'such return is to be filed'. - Where 'no Return' is required to be filed, relevant date is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e date on which 'duty is to be paid'. In case where excise 'duty is provisionally assessed', the relevant date is the 'date of adjustment of duty' after final assessment is made. In case of erroneous refund of duty, relevant date is the 'date of actual payment of refund' and not when order sanctioning such refund is passed. In case of corrigendum or subsequent show cause notice, if revised notice is making material changes in original notice or increasing the demand amount or raising entirely new or fresh grounds, is treatable as fresh notice and time limit will be calculated from the date of such fresh notice and not from the earlier notice. However, such corrigendum notice has no effect if it is issued beyond period of limitation or issued after matter is adjudicated. This time limit is mandatory and hence applies even in cases, for e.g. where interim stay order has been issued by the court unless there is specific stay order restraining them for issuing show cause notice. However there are certain situations were no time limit is imposed for issue of show cause notice. For e.g. where demand is raised under sections other than section 11A or under specific scheme su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch as under compounded levy scheme. Mere issue of notice is not sufficient, it must be served also. Show cause notice is deemed to be served on the date on which it is delivered by post or copy is affixed on notice board. It may be noted that in the case of post, notice is deemed to be served where recipient refuses to accept the notice, unless contrary is proved. However, where it is returned with the mark 'not found' it will be presumed not to have been served. Requirements of show cause notice: - Show cause notice must be clear and not vague or ambiguous. It should give all the essential particulars, such as - Amount of duty demanded (there are contrary views that whether the show cause notice quantify the amount demanded or not). Basis for demand (i.e. nature of contravention and provisions contravened). However, non-mentioning or wrong mentioning of rule or section will not vitiate the notice. Details of Penalty or confiscation must be mentioned, if proposed to be imposed or to confiscate the goods, otherwise penalty or confiscations are not sustainable. Authenticated copies of all relevant documents (or whatever evidence obtained), relied upon by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he department, must be supplied to the assessee. Otherwise, order cannot be issued on the basis of evidences/ investigations which was not disclosed in the show cause notice. Authority cannot raise a demand on the point which was not mentioned in the show cause notice, as it will violate the statutory provisions. Also show cause notice must indicate that it is for demand of duty, mere notice proposing change in classification is not sufficient. Adjudication 'Adjudication' means giving a decision. The adjudication is done by the departmental officers. They understand the facts of the case, process them properly and apply sections and rules of central excise law or notifications relevant for the case. They are empowered to adjudicate the cases with respect to the demand of duty, credit availed, determination of classification, valuation, confiscation and imposing penalty. Adjudication is done by following the principles of natural justice. Following principles must be followed by both judicial and quasi-judicial authorities in every proceeding: - Authorities should decide a matter on the basis of the material facts and evidence. Opportunity of personal hearing to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the party - The noticee shall be given an opportunity of personal hearing before the case is adjudicated. Adjudicating authority can give time to parties and adjourn the hearing for reasons to be recorded in writing. Maximum three adjournments can be granted during the proceeding. If a statement of a particular person (witness) is relied upon, opportunity of cross-examining the person must be given if demanded. If such opportunity is not given, the statement cannot be relied upon. Passing the order, giving reasons, by authority - After the hearing an order of adjudication is passed which is called order-in-original. Normally the order is passed within 5 days after personal hearing is over. If this is not possible, order must be passed within 15 days or at the most within one month from the date of conclusion of personal hearing. Officer shall pass a speaking order, which means, order should give reasons for such decision, quantifying correctly the duty demanded and confirmed, specifying the provisions under which duty is confirmed and penalty is imposed. Mere, simple letter asking for payment of duty is not an order. Unbiased authority - Quasi-judicial au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thorities should Act independently and should give unbiased decision. Also they are not bound by any trade notices or administrative instructions while deciding appeal. However, if he exercises his powers negligently or if he acted in order to unduly favour a party, disciplinary action can be initiated. Also the authority cannot delegate the power to any other officer. For e.g. if commissioner decides the main issue, he should himself pass the final order giving quantum of duty. he may take assistance from his subordinate officers for this purpose, but final decision must be communicated by commissioner himself. When there are two or more authorities having parallel jurisdiction over the same matter, when any one of them exercises its authority, jurisdiction of second and any other authorities are eclipsed. Review of order Once the order is passed by the authority, he cannot review or re-examine or rescind his own order unless such power is specifically conferred by the statute. Also authority cannot review its order by issuing a corrigendum except where clerical mistake is to be corrected. However, where power to review is given, it should be reviewed as far as possible ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the same authority and that too for correction of a mistake and not to substitute a view. 'Authority' for adjudication A. All cases involving fraud, collusion, any willful mis-statement, suppression of facts or contravention of central excise act/ rules with an intent to evade duty or where extended period has been invoked in show cause notices (including classification and valuation of excisable goods and Cenvat credit cases), will be adjudicated as mentioned in the table below - B. cases which do not fall under category (A) above including all cases relating to determination of classification and valuation of excisable goods and Cenvat credit will be adjudicated as mentioned in the table below - Authority to adjudicate Powers of adjudication (Amt. of duty involved) AC/ DC Upto Rs. 5 lakhs Joint Commissioner Between Rs. 5 lakhs to Rs. 20 lakhs Additional Commissioner Between Rs. 20 lakhs to Rs. 50 lakhs Commissioner No limit Superintendent Cannot issue show cause notice C. In cases relating to issues under 1 st proviso to section 35B (1) of central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... excise act, 1944 would be adjudicated by the Additional/ Joint Commissioners without any monetary limit. The cases under section 35B (1) are as follows: - Loss of goods in transit from factory to warehouse or from warehouse to warehouse. Rebate of duty of excise of goods exported. Goods exported outside India, except Nepal and Bhutan, without payment of duty. Credit of duty allowed to be utilized towards payment of excise duty on final products and such order is passed by the commissioner (appeals). Appeals The provisions for appeal are contained in chapter VI A of the central Excise Act,1944 . It consists of three stages of appeal [i.e. to Commissioner (Appeals), CESTAT (i.e. Appellate Tribunal), High Court], two stages of revision and further appeal to Supreme Court. In case of orders passed by superintendent, AC, DC, joint commissioner, additional commissioner as adjudicating authorities i.e. orders passed by the officers lower than the rank of commissioner of central excise, the first appeal is with Commissioner (Appeals) and second appeal is with Appellate Tribunal. However, in case of orders passed by commissioner as adjudicating authority the onl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y appeal lies with the Appellate Tribunal. There are two parties to an appeal - one the assessee and the other the excise department. If one party files an appeal, another can file cross-objections, in nature of cross appeal. Appeal cannot be filed against a trade notice. Appeal can be filed only against decision or order only. Appeal to Commissioner (Appeals) As per section 35B (1) of CEA , the appeal against order of officers below the rank of commissioner lies with Commissioner (Appeals). Such appeal can be filed against any decision or order of an officer below the rank of commissioner or if such officers rejects a claim or refuses some permission without giving hearing. Provisions for appeal to Commissioner (Appeals) 1. Filling of Application for appeal - As per rule 3 of CEA an assessee shall file such appeal in prescribed Form no.E.A.-1 in duplicate which shall be accompanied with a certified copy of the decision or order against which appeal is filed. The department shall file appeal in prescribed Form no.E.A.-2 in duplicate which shall be accompanied with two copies (one of them shall be certified) of the decision or order passed by the ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judicating authority and a copy of the order passed by commissioner of central excise directing the authority to apply to Commissioner (Appeals). Appeal should state statement of facts and grounds of appeal. The form of appeal (i.e. E.A.-1 ) shall be verified that it is true to the best of knowledge and belief. If not verified in the prescribed time the appeal can be dismissed on this ground. Both form of appeal and ground of appeal shall be signed as per section 3(2) : - In case of individual - by the individual himself or by some person duly authorized by him in this behalf. - In case of HUF - by the Karta or if he is absent or incapacitated by any other adult member of such family. - In case of company or local authority - by the principal officer. - In case of firm - by any partner but not minor partner. - In case of any other person - by a person competent to act on his behalf. Affixing of court fee stamp, of 50 paisa, to appeal and copy of order is required while filing of appeal before Commissioner (Appeals). If it is not affixed, it is curable and appeal cannot be dismissed on this ground. No fee is payable along with such an application. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. Time limit for filing appeal to commissioner (appeal) - Appeal must be filed within 60 days from the date of communication of order. However, this period can be extended with further 30 days, on showing sufficient cause, by Commissioner (Appeals). 3. Procedure after filing appeal [ section 35A ]- The commissioner (appeals) shall give an opportunity of hearing to the appellate, if he so desires. The commissioner (appeals) cannot dismiss appeal for non-appearance. In such a case the notice must be served to the appellant if case is not decided in favour of him. As per rule 5 of CEA, the appellant is not allowed to produce additional evidences i.e. evidences which are not submitted before the adjudicating authority. However in the cases mentioned below the additional evidences can be admitted provided Commissioner (Appeals) records the reasons in writing and give reasonable opportunity to the adjudicating authority to examine any witness or to produce any evidence in rebuttal of the additional evidence produced by the appellant. - When adjudicating authority has refused to admit evidence which ought to have been admitted. - Where the appellant was not able to p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roduce evidence due to sufficient reasons. - When sufficient opportunity was not given to appellant to produce relevant evidence. As per rule 4(4) , the commissioner (appeals) can on his own examine any document or witness for proper disposal of appeal. The commissioner (appeals) shall, after making such further enquiry, pass such order, as he thinks just and proper, confirming, modifying or annulling the decision or order appealed against. Where order enhancing penalty or fine in lieu of confiscation imposed in the original order or where additional duty is demanded, the commissioner (appeals) shall do so only after giving the appellant show cause notice and reasonable opportunity of being heard. 4. Communication of order - The order shall be in writing giving reasons for such order. The order shall be communicated to appellant, adjudicating authority chief commissioner and commissioner of the central excise. The commissioner (appeals) shall hear and decide the appeal within a period of 6 months from the date on which application for appeal is made, wherever it is possible. Order of commissioner (appeals) shall be binding on the adjudicating aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hority. It shall also be binding on subsequent case of same assessee unless there are valid reasons to take different view. 5. Review of order passed by commissioner (appeals) - Commissioner appeal cannot review his final orders. But he can review his interim/ stay orders. No appeal lies against such interim orders with superior authority also. Appeals to Appellate Tribunal (or CESTAT) As per section 35B (1) of CEA , the appeals, against order of commissioner of central excise as adjudicating authority and order of commissioner (appeals), lies with appellate tribunal (or CESTAT), except in the following cases where revision application has to be made to the central government: - Loss of goods in transit from factory to warehouse or from warehouse to warehouse. Rebate of duty of excise of goods exported. Goods exported outside India, except Nepal and Bhutan, without payment of duty. Refund of duty drawback. Credit of duty allowed to be utilized towards payment of excise duty on final products and such order is passed by the commissioner (appeals). Tribunal is the final fact finding authority i.e. facts arrived at by tribunal cannot be upset by highe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r authority unless found to be based on irrelevant evidence or incorrect principles. Benches of tribunal Tribunal sits in benches. The benches of the tribunal are composed of judicial and technical members. Presently benches are at New Delhi, Mumbai, Kolkata, Chennai and Bangalore. Formation of benches and allocation of work to the benches is done by President of CESTAT. Single member bench has the jurisdiction as authorized by president of CESTAT to hear appeals involving an amount of duty, fine or penalty not exceeding Rs. 10 lakhs. If the bench does not agree to a previous decision of bench (with same number of members), the matter should be referred to president for forming a larger bench. Provisions for appeal to CESTAT 1. Filling of Form and application for appeal - Appeal to tribunal shall be made in Form no.E.A.-3 in quadruplicate with copy of order appealed against. The memorandum of cross objection should be filed in Form no. E.A.-4 in quadruplicate within 45 days of receiving of notice of such appeal. It should be duly verified. The cross objections should be serially numbered and under different heads. Departmental appeal should be filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Form no. E.A.-5 in quadruplicate accompanied with equal number of copies of order appealed against (one of them shall be certified) and a copy of the order passed by the Board directing such Commissioner to apply to the Appellate Tribunal. If appeal is to be heard by larger bench, additional copies have to be supplied. Appeal should be filed within the jurisdiction of CESTAT bench where the factory is situated or where its head office, or registered office or place of residence is situated irrespective of the place where the authority which has passed the order is situated. Appeal, cross objections etc. can be filed either in person or by registered post to the Registrar or Assistant registrar of respective bench. The appeal must be accompanied by a fee. The fee is payable according to the amount of duty, interest demanded and penalty levied. Amount of duty, interest and penalty levied Fee for filing appeal Less than or equal to Rs. 5 lakhs Rs. 1000 Between Rs. 5 lakhs to Rs. 50 lakhs Rs. 5000 Exceeds Rs. 50 lakhs Rs. 10000 Further a fee of Rs. 500 shall be paid for application made f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or cross objection or for stay order or for rectification of mistake or for restoration of appeal or for any other purpose. No fee shall be payable in the cases where application is filed by or on behalf of the Commissioner of central excise or where appeal is filed when no duty, penalty or interest is demanded. Affixing of court fee stamp, of Rs. 2 on memorandum of appeal and of 50 paisa on copy of order appealed against (advisable to refer to the provisions of state), is required. If it is not affixed, it is curable and appeal cannot be dismissed on this ground. 2. Time limit for filing appeal to CESTAT - Appeal shall be filed within 3 months from the date of receipt of order to be appealed against i.e. from the date of receiving of order of commissioner of central excise as adjudicating authority and order of commissioner (appeals). 3. Procedure after filing appeal - Tribunal on its own can call for any document or examine any witness or ask for filing of affidavit. Additional evidence can also be permitted, after recording the reasons in writing, if adjudicating authority had not given sufficient opportunity to party to produce the evidence. Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will scrutinize the appeal and any defects found are informed to the party concerned for removal of defects in the specified time otherwise matter will be dismissed and will be restored only if sufficient cause for delay is shown. Tribunal shall give an opportunity of hearing to the appellant, if he so desires. If the appellant does not appear, tribunal may dismiss the appeal or can pass ex-parte order. If non-appearance was due to sufficient reasons, the dismissed appeal can be restored. Normally, hearing of appeal is done in chronological order. However, tribunal can give early and out of turn hearing if matter is of recurring nature. Tribunal after making further enquiry, can pass such orders as it thinks fit confirming, modifying or annulling the decision or refer it back to the authority which passed such order with required directions. 4. Communication of order - The appellate tribunal shall hear and decide every appeal within a period of three years, wherever it is possible. However if stay is granted by tribunal for recovery, appeal shall be decided within 180 days. If such appeal is not disposed of within the period specified the stay order shall, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the expiry of that period, stand vacated. Tribunal may within 6 months from the date of the order amend order passed by it, to rectify any mistake apparent from the record. Every order shall be signed by members of the bench with date. Revision by Central Government As per section 35EE, the matters for which no appeal lies with CESTAT, a revision application has to be made with Central Government against the orders of the commissioner (appeals). Cases where CESTAT has no power or where revision application has to be made are as follows: - Loss of goods in transit from factory to warehouse or from warehouse to warehouse. Rebate of duty of excise of goods exported. Goods exported outside India, except Nepal and Bhutan, without payment of duty. Refund of duty drawback. Credit of duty allowed to be utilized towards payment of excise duty on final products and such order is passed by the commissioner (appeals). Processing loss. Goods short landed. Provisions for revision made to Central Government 1. Filing of application - The application for revision shall be made in Form no.E.A.-8 in duplicate and shall be accompanied by two copies o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f order of commissioner (appeals) and two copies of original order against which commissioner (appeals) had passed the order (i.e. order passed by central excise officer). The revision application shall be submitted either in person to the Under-Secretary Revision Application Unit, Government of India, Ministry of Finance, Department of revenue, New Delhi or sent by registered post. The grounds of revision application and the form of verification as contained in E.A.-8 shall be signed by the persons as per section 3(2) of CEA [refer commissioner (appeals)]. Application must be accompanied by a fee of Rs. 1000 if duty and interest demanded exceeds Rs. 1 lakh. However, if duty, interest and penalty is less than Rs. 1 lakh fee of Rs. 250 is payable. 2. Time for filling revision application with the Central Government - Revision application to the central government shall be made within 3 months from communication of order by commissioner (appeals). However, this period can be extended with further 3 months, on showing sufficient cause. 3. Procedure after application is made - The Central Government shall give an opportunity of personal hearing to the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant. If Central Government proposes to enhance the penalty or fine in lieu of confiscation, a show cause notice has to be given to the appellant within the time limit as per section 11A. The central government shall pass the order on its own motion, annul or modify the order of commissioner (appeals). 4. Other points to be noted in respect of revision application to Central Government - The Central Government may refuse to accept the revision application, if the amount of duty, interest and penalty does not exceed Rs. 5000. No time limit has been prescribed for passing of order by the Central government. There is no provision of appeal against orders of Central Government. The only remedy is writ petition to High Court or SLP in Supreme Court. Appeal to High Court Appeal against the order of the tribunal, lies with the High court, if the case involves substantial question of law except in cases relating to rate of duty and valuation against which appeal lies with Supreme Court. Provision for appeal to high court 1. Filing of application for appeal - An application for appeal to High court shall be made in Form no.E.A.-6 in quadrupl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icate, stating precisely therein the substantial question of law involved. The memorandum of cross objections shall be made in Form no.E.A.-7 in quadruplicate. Both the application and memorandum of cross-objections or the form of verification shall be signed by the persons as per section 3(2) of CEA, [refer commissioner (appeals)]. Application shall be accompanied by a fee of Rs. 200 in case appeal is filed by the other party i.e. no fee is payable if appeal is filed by the commissioner of CE. 2. Time limit for filling appeal - Appeal must be filed within 180 days from the date on which the order appealed against is received by the commissioner of central excise or the other party. 3. Procedure after application is filed - If the High court is satisfied that substantial question of law is involved, it will formulate the question. It is not necessary to hear the other party when appeal is admitted on a question of law. The High court will deliver the judgment on the substantial question of law either formulated by it or even if not formulated by it, if it is satisfied that the case involves such substantial question of law. Appeal to Sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reme Court Appeal to Supreme Court can be made in the following cases: - Against the order of Appellate Tribunal, where it relates to rate of duty and valuation. Any judgment of the High Court, if high court certifies that it is a fit case for appeal to Supreme Court. Any judgment of High Court, in reference to cases made before 1/07/2003, if it feels that it is a fit case for appeal to Supreme Court. Provisions for appeal to Supreme Court 1. Time limit for filing appeal - Appeal to supreme Court shall be made within a period of 60 days from the date order is communicated. 2. Filing of application for appeal - Appeal should be filed along with its 7 copies. Appeal should state all relevant facts, objections and ground of appeal. An authenticated copy of order appealed against should be attached with the appeal. 3. Review of order of Supreme Court - Review should be filed only in exceptional cases. Application for review of judgment of Supreme Court has to filed within 30 days. - Reply By yateen vyas - The Reply = A very big thanks sir,the way you gave answer it will solves my so many question from very initial state.. - Reply By P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... radeep Khatri - The Reply = Reading is very good habit. You should develop this habit. " When in doubt, kiss the fish" . - How to file an appeal in Excise.Service tax - Query Started By: - yateen vyas Dated:- 16-4-2013 Central Excise - Got 5 Replies - Central Excise - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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