Mere Postal Dispatch Without Proof of Delivery Does Not Satisfy Service Requirements u/s 37C(1) of Central Excise: CESTAT [Read Order]

The Allahabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that mere postal dispatch of an order without proof of delivery does not satisfy the service requirements under Section 37C(1)(a) of the Central Excise Act, 1944, and remanded the case for decision on merits.

Hotel Elora, the appellant, challenged the dismissal of their appeal by the Commissioner (Appeals), who rejected it on the ground of limitation. The Order-in-Original dated 26.02.2022 had allegedly never been received by the appellant. It was only after recovery proceedings began that the appellant became aware of the order and requested a copy, which was received on 09.08.2022. The appellant then filed an appeal on 02.11.2022.

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The department’s counsel argued that the order had been dispatched by post and was not returned undelivered, and thus it should be presumed to have been served. The Commissioner (Appeals) accepted this presumption and dismissed the appeal as time-barred without examining the case on the merits.

The appellant’s counsel argued that the department had failed to produce any evidence to show that the order was actually delivered. They argued that under Section 37C(1)(a) of the Central Excise Act, service of orders must be made through Registered or Speed Post with acknowledgment due, which was not fulfilled in this case. The appellant relied on several judgments, including R.P. Casting Pvt. Ltd. v. CESTAT, Duggar Fibre Pvt. Ltd. v. CCE, and Regent Overseas Pvt. Ltd. v. Union of India.

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The two-member bench comprising Judicial Member P.K. Choudhary observed that mere dispatch of an order is not enough, and the department must provide proof of delivery in accordance with the law. In the absence of such proof, the presumption of service is not legally sustainable. The tribunal held that the dismissal of the appeal on limitation was unjustified and contrary to legal requirements.

The tribunal set aside the impugned order and remanded the matter to the Commissioner (Appeals) to decide the case on merits, without re-examining the limitation issue. The appeal was allowed by way of remand.

To Read the full text of the Order CLICK HERE

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