CESTAT finds Impugned Order Cryptic in Nature: Remands Matter for Denovo Adjudication [Read Order]

The Delhi bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) remanded the matter for denovo adjudication as it found the impugned order cryptic in nature.

The appellant, Rishab Mineral Industries, is engaged in the manufacture of quartz/silica/other mineral powders/lumps, etc. The department observed that the appellant was liable to pay service tax under the reverse charge mechanism on the taxable service of Rs. 10.54 lakhs in service tax for Transport of Goods by Road (GTA) from 2011-12 to 2015-16.

A show cause notice (SCN) was passed in which a penalty was imposed under Sections 77 and 78 of the Finance Act, 1994.

The assessee’s counsel contended that the matter should be remanded, as there was a clear violation of natural justice principles, as the assessee was not given a proper opportunity to represent its case before the adjudication authorities.

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The department’s representative gave no objection to remanding the matter.  

The bench observed that, on the face of it, the principle of audi alteram partem, or hearing both sides, has not actually been violated, as the assessee did not file a reply to the SCN. The bench noted that the authorised representative of the appellant had appeared before the original adjudicating authority and sought an adjournment from 16.03.2017 up to 10.04.2017 for filing his reply and for making his submissions. But as the reply was not submitted on 10.04.2017, the original adjudicating authority, based on the available record, decided the matter.

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 The bench, by going through the impugned order, noted that it was cryptic in nature. The tribunal noted that, except for relying upon the decision of this tribunal in the case of M/sMSPL Limited vs. Commissioner of Central Excise, Belgaon reported 2009 (013) STR 0554, no other findings have been given by the Commissioner (Appeals). The bench remanded the matter back to the original adjudicating authority.

The tribunal, consisting of Dr Rachna Gupta (Judicial Member) and Hemambika R. Priya (Technical Member), allowed the appeal by way of remand.

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