CESTAT initiates ‘Contempt of Court’ Proceedings against Asst Commissioner for Issuing Notice despite Tribunal Order [Read Order]

The Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has referred a matter to the High Court for initiating ‘Contempt of Court’ proceedings against the Assistant Commissioner (Service Tax) for issuing a show-cause notice against the assessee by ignoring the Tribunal order.

The assessee, M/s Portech India Pvt Ltd, filed a refund claim under Rule 5 of Cenvat Credit Rules read with Notification No. 27/2012-CE (NT). However, the same was rejected on the ground that the appellant did not debit the amount of refund claim at the time of filing the refund claim, but have debited such amount subsequent to the filing of the refund claim but before the adjudication. On appeal, the Tribunal held that the debit of the amount of refund claim in the cenvat credit register, suo motu before the adjudication, is sufficient compliance of Condition No. 2(h) of the said notification. Accordingly, the appeals were allowed with consequential benefit, directing the Adjudicating Authority to grant the refund within a period of 45 days from the date of receipt of the order with interest as per rules. However, when the assessee approached the department, a show-cause notice was issued against them with regard to both the amounts of refund, requiring the appellant to show cause proposing to disallow part of the amount on the ground(s) mentioned in the show cause notices.

The assessee carried the matter before the CESTAT again.

Mr. Anil Choudhary, Member (Judicial) observed that the refund claim was originally adjudicated by the Assistant Commissioner vide order-in-original and was rejected only on the ground of non-compliance with Condition No. 2(h) of Notification No. 27/2012 (Condition of debit of the refund amount at the time of filing of refund claim).

“In the appeals filed by the assessee before the Commissioner (Appeals) the orders were upheld rejecting the appeals. Thus, there was no issue regarding any part of the refund claim under Rule 5B of Cenvat Credit Rules read with Notification No. 12/2014-CE. Thus, in the facts and circumstances, this Tribunal finds that the action of the said Assistant Commissioner, Sh. Ravi Babu in issuing the show cause notices after passing of the final order of this Tribunal, with respect to the subject matter of refund adjudicated by this Tribunal, was wholly against the provisions of law, in clear contravention of the ‘doctrine of merger’ and amounts to interference in the justice delivery system. Accordingly, this Tribunal is hereby referring this matter to the Hon’ble Delhi High Court for initiating suitable action/ proceedings under Section 10 of the Contempt of Courts Act, 1971, for contempt of this Tribunal, which is a sub-ordinate Court to Hon’ble Delhi High Court,” the Tribunal said.

Advocate Abhinav Kalra appeared for the Appellant.

To Read the full text of the Order CLICK HERE

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