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TMI Blog2023 (4) TMI 772X X X X Extracts X X X X X X X X Extracts X X X X ..... rgoes was not taken into consideration and that the Petitioner had offered that his personnel Shri Gaurav would approach the department to explain the workings when called for. It emerges from the above that this is nothing but a case of breach of principles of natural justice, as despite Petitioner s offer to assist the Adjudicating Authority in explaining the computational errors and inspite of the Adjudicating Authority s admitted inability to figure out the details with respect to the actual reversal in relation to the subject ST-3 Returns resulting in rejection of petitioner s claim for reduction in demand, which the Authority could have simply been able to resolve by asking for the assistance of petitioner s personnel. Therefore, the decisions cited on behalf of the Respondents would not apply in the facts of this case. Matter remanded back to the Respondent Adjudicating Authority to pass a fresh order - The Adjudicating Authority to complete the entire exercise within a period of six weeks after affording an opportunity to the Petitioner to explain the computation errors in detail for the purposes of re-computation of the demand in accordance with law. Petition allo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssued an observation letter dated 21 August 2019 to Petitioner alleging non-reversal of Cenvat Credit under Rule 6(3) of the Credit Rules for corresponding tickets sold in India where the place of embarkation was outside India. There was a pre-consultation meeting where it was submitted that bookings done in India and where embarkation point is outside India does not form part of turnover of the Petitioner. Petitioner is stated to have submitted a detailed reply to the audit observation letter dated 21 August 2019 as well as to the pre-consultation notice dated 18 September 2019 vide letter dated 24 September 2019 wherein it was submitted that turnover and exempt turnover should be determined qua the service provider and the applicability of service tax for passenger transportation services was based on the concept of embarkation. 5. Thereafter, a show cause notice dated 7 October 2019 came to be issued by the Respondent no. 2 alleging the following: a) That Cenvat Credit amounting to INR 81,66,72,907 was recoverable from the Petitioner for the period April 2014 to June 2017. b) That TPA Service where tickets sold in India and place of embarkation is outside India sat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thority in the Order-in-Original in paragraph 3.7 of the Order-in-Original, wherein it was also stated that Petitioner s personnel Shri Gaurav would approach the Department to explain the workings when called for. 8. Paragraph 3.7 of the said Order-in-Original is as under : 3.7 He further stated that issue in the instant case is that the department seeks reversal of cenvat credit considering reversal formula with total credit availed instead of only working out reversal with common credit. He stated that the are several judgments which says reversal has to be worked out using common credit and not on the basis of total credit. They stated that there was mistake in computation of the demand. While calculating the demand, value of exempted service of transport of cargos was not take into consideration and stated that his personnel Shri Gaurav would approach department to explain the workings when called for. 9. Learned Senior Counsel submits that instead of calling upon Petitioner s personnel to explain the workings, the Adjudicating Authority has gone ahead and passed the Order-in-Original on the basis of the written submissions to the show cause notices. The learned S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documentary evidence to substantiate the reversal made by the Noticee particularly linking to the demand of this SCN. Thus, a reduction of demand sought of Rs. 37,90,63,266/- in their reply dated 12.11.2019 cannot be entertained. 10. Learned Senior counsel submits that the said paragraph clearly suggests that despite being dissatisfied about the explanation in the written submissions and despite recording his inability to figure out the exact reversals made by the noticee and as to whether the reversal made was related to the particular demand of the show cause notice and recording his inability to appreciate how the figures were arrived at by the Petitioner in their claim and those appearing in the ST-3 Returns, merely on the basis of available record, the Adjudicating Authority has gone ahead and raised the demand. 11. The learned Senior Counsel submits that although against the impugned order Petitioner would file a substantive Appeal, however, with respect to the failure on the part of the Adjudicating Authority to seek assistance from the Petitioner s personnel for appreciating the computation errors, on this limited aspect, direction of this Court would be necessary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring to the reply dated 11 April 2023, the learned Standing Counsel would submit that the offer of the Petitioner with respect to his personnel Shri Gaurav was only a suggestion from the Petitioner to explain the workings when called for, which meant that if the Adjudicating Authority required any explanation on the written or oral submissions made by the Petitioner before the Adjudicating Authority, the same would have been called for but the same was not mandatory on the part of the Adjudicating Authority if the written and oral submissions were sufficient to conclude the proceedings. That, the Adjudicating Authority was under no compulsion to give an additional in-person hearing when sufficient detailed written submissions were before him and the hearing before the Adjudicating Authority was already given to the Petitioner. The learned Standing Counsel relies upon the decisions in the cases of (i) State of Madhya Pradesh and Another vs. Commercial Engineers and Body Building Company Limited 2022 SCC Online SC 1425 (ii) Assistant Commissioner of State Tax vs. Commercial Steel Ltd. 2021 (52) G.S.T.L. 385 (S.C.), and (iii) HDFC Bank Limited vs. The Union of India and Another Writ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity was under no compulsion to give an additional in person hearing when sufficient detailed written submissions were before him and the hearing before the Adjudicating Authority was already given to the Petitioner. 17. It emerges from the above that this is nothing but a case of breach of principles of natural justice, as despite Petitioner s offer to assist the Adjudicating Authority in explaining the computational errors and inspite of the Adjudicating Authority s admitted inability to figure out the details with respect to the actual reversal in relation to the subject ST-3 Returns resulting in rejection of petitioner s claim for reduction in demand, which the Authority could have simply been able to resolve by asking for the assistance of petitioner s personnel. Therefore, the decisions cited on behalf of the Respondents would not apply in the facts of this case. 18. In this view of the matter, we are inclined to remand the Order-in-Original dated 9 May 2022 to the Respondent no. 2 to be decided afresh. 19. The Order-in-Original dated 9 May 2022 is accordingly set aside and remanded back to the Respondent Adjudicating Authority to pass a fresh order in the light of th ..... 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