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TMI Blog2002 (8) TMI 150X X X X Extracts X X X X X X X X Extracts X X X X ..... 18-2-99 was issued to them which was dropped by the Deputy Commissioner on the ground that the Supreme Court in the case of Laghu Udyog Bharti v. UOI - 1999 (112) E.L.T. 365 (S.C.) had held that provisions of Rule 2(d)(xvii) was ultra vires to the Act. Section 116 of the Finance Act, 2000 provided that notwithstanding anything contained in any judgment or order, sub-clauses (xii) and (xvii) of clause (d) of sub-rule (1) of Rule 2 of the Service Tax Rules, 1994 shall be deemed to be valid and to have always been valid as if the said sub-clauses had been in force at all material time and accordingly any action taken or anything done or purported to have been taken or done at any time during the period from 16-7-97 and ending with the day, the Finance Act, 2000 receives the assent of the President shall be deemed to be valid and always to have been valid for all purposes, as validly and effectively taken or done. A notice dated 14-5-2001 was issued to the Appellants proposing to revise the Adjudication Order dated 16-2-2000 passed by the Deputy Commissioner. The Commissioner, under the impugned order, set aside the said order dated 16-2-2000 and directed the Deputy Commissioner to pas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dation Act......stipulate that to be the object, nor even Parliament thought fit to have a saving clause in the Validation Act as was done in Jaora Sugar Mills case". The Supreme Court, therefore, held in TISCO case that the "Validation Act cannot be construed to have conferred a right to make levy and collection of Cess or taxes on minerals which were collected up to 4-4-1991, as was held in Kannadasan case but it merely validated the collections already made so that the State will not be burdened with the liability of refunding the amount, already collected under void law". 4. The learned Advocate contended that the decision in TISCO case is squarely applicable as no Saving Clause has been provided in the Validation provision in Section 117 of the Finance Act; that Validation provisions only affects the refund of Service Tax which had been levied and collected; that this is evident from the fact that there is no provision in Section 117 for recovering the Service Tax. The learned Advocate also mentioned that review done under Section 84 of the Finance Act, 1994 is wrong; that show cause notice setting out the reasons for review should have been issued; that the letter dated 14- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se and the Parliament has validated the levy and collection by enacting Section 117 of the Finance Act retrospectively, the same reason was mentioned in the notice dated 14-5-2001; that Section 84 of the Finance Act, 1994 empowers the Commissioner to "pass such order" as he thinks fit; that the Appellate Tribunal in the case of Rewa Gases Pvt. Ltd. v. CCE, Raipur, 2002 (143) E.L.T. 375 (T) = 2002 (51) RLT 28 (CEGAT) has upheld the review made by Commissioner of the adjudication order dropping the proceedings, after validation of provisions by Finance Act, 2000. 6. The learned SDR, further, submitted that the decision in TISCO case is not applicable to the facts of the present matter, that the levy was held to be outside the legislative competence of State Government by the Supreme Court and the said decision had a serious impact on the revenues of several State Government as not were they barred from collecting the Cess, quite a few of them were obliged to refund substantial amounts which had already been collected; that it is evident from the Statement of Objects and Reasons that "since refund was likely to have a serious impact on State Revenues of the concerned State Governmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been in force at all material times and accordingly - (i) any action taken or anything done or purported to have been taken or done at any time during the period commencing on and from the 16th day of July, 1997 and ending with the day, the Finance Act, 2000 receives the assent of the President shall be deemed to be valid and always to have been valid for all purposes, as validly and effectively taken or done; (ii) any service tax refunded in pursuance of any judgment, decree or order of any court striking down sub-clauses (xii) and (xvii) of clause (d) of sub-rule (1) of rule 2 of the Service Tax Rules, 1994 before the date on which the Finance Act, 2000 receives the assent of the President shall be recoverable within a period of thirty days from the date on which the Finance Act, 2000 receives the assent of the President, and in the event of non-payment of such service tax refunded within this period, in addition to the amount of service tax recoverable, interest at the rate of twenty-four per cent per annum shall be payable, from the date immediately after the expiry of the said period of thirty days, till the date of payment. Explanation. - For the removal of do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner of Central Excise, exercising his powers under Section 84 of the Finance Act, 1994 has revived the show cause notice dated 18-2-99 which was dropped by the Dy. Commissioner following the Supreme Court decision in Laghu Udyog Bharti case. The decision in the case of Distt. Mining Officer and Others v. Tata Iron Steel Co. Another, (2001) 7 SCC 358 is not applicable to the facts of the present matter. The Cess and Other Tax on Minerals (Validation) Act, 1993 was enacted by the Parliament as it thought that on account of the judgment of the Supreme Court, the State Government would be liable to make refund of CESS and other taxes collected by them, which was likely to have a serious impact on the State Revenue, and to prevent the liability of refund, the Parliament intended to validate collection of levy already made by the State Government up to 4-4-1991. It was observed by the Supreme Court that the said conclusion was based on not only the language used in Section 2(1) but also the Statement of Objects and Reasons. In the light of these facts it was held by the Supreme Court in TISCO case that "Validation Act cannot be construed to have conferred a right to make levy a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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