2015 (10) TMI 2537 - AT - Service Tax

Tribunal Upholds Commissioner's Remand Power under Finance Act, 1994

The Tribunal dismissed the Revenue's appeal challenging the Commissioner (Appeals)' power of remand under the Central Excise Act, 1944. The Tribunal ... Power of Commissioner (Appeals) to remand the matter - Section 35A(3) of Central Excise Act, 1944 - Revenue contended that Commissioner (Appeals) has no power of remand as the said power was taken away by amending Section 35A of the Central Excise Act, 1944 w.e.f. 11-5-2001 - Held that:- it has been rightly contended by the Revenue that the Commissioner (Appeals) had the power only to confirm, modify or annul the decision or order appealed against and did not have the power to remand the case to the primary adjudicating authority as the words “or may refer the case back to the adjudicating authority with such direction he may thinks fit for fresh decision or as the case may be after taking additional evidence if necessary” which existed in Section 35A(3) prior to 11-5-2001 were deleted w.e.f. 11-5-2001. But as per Section 85(4) of the Finance Act, 1994 the “Commissioner of Central Excise (Appeals) shall hear and determine the appeal and subject to the provisions of this chapter pass such order as he thinks fit and such orders may include an order enhancing the service tax interest or penalty”. Thus it is seen that the language of Section 85(4) is not pari materia the language of Section 35A(3) of the Central Excise Act, 1944. Indeed, Section 85(4) of the Finance Act, 1994 allows/authorises Commissioner (Appeals) to pass such order he thinks fit and therefore it cannot be argued that as per this Section [85(4)] the Commissioner (Appeals) cannot remand the case if he thinks fit to do so. It is seen that in the case of Commissioner of Central Excise, Panchkula v. Goel International Pvt. Ltd. [2015 (12) TMI 329 - CESTAT NEW DELHI], CESTAT has held that language used in Section 85(4) has wider connotation and power to pass such order as he thinks fit includes the power of remand. - Decided against the Revenue Issues involved:1. Power of remand by Commissioner (Appeals) under Central Excise Act, 1944.2. Interpretation of Section 35A(3) of the Central Excise Act, 1944.3. Comparison of powers of remand under Central Excise Act and Finance Act, 1994.4. Applicability of judgments regarding remand powers in service tax appeals.Analysis:1. The main issue in this case revolves around the power of remand by the Commissioner (Appeals) under the Central Excise Act, 1944. The Revenue filed an appeal against an order-in-appeal that set aside the original order and remitted the case for fresh decision. The appeal challenged the Commissioner's power of remand, citing an amendment to Section 35A of the Central Excise Act, 1944, which was argued to have removed the power of remand.2. The crux of the matter lies in the interpretation of Section 35A(3) of the Central Excise Act, 1944, as amended w.e.f. 11-5-2001. The Revenue contended that the Commissioner (Appeals) only had the authority to confirm, modify, or annul the decision under appeal, without the power to remand the case. This argument was supported by the deletion of specific provisions allowing for remand post the mentioned amendment date.3. However, a crucial comparison was drawn between the provisions of the Central Excise Act, 1944, and the Finance Act, 1994, specifically Section 85(4). It was highlighted that while the language of Section 35A(3) restricted the power of remand, Section 85(4) of the Finance Act, 1994, empowered the Commissioner (Appeals) to pass any order he deems fit, including the power of remand. This distinction was pivotal in determining the Commissioner's authority to remand a case for fresh decision.4. In light of the arguments presented and the comparison of relevant legal provisions, the Tribunal found no merit in the Revenue's appeal. The Tribunal's decision was influenced by a judgment in a service tax appeal case, Commissioner of Central Excise, Panchkula v. Goel International Pvt. Ltd., which emphasized the wider connotation of Section 85(4) of the Finance Act, 1994, allowing for the power of remand. Consequently, the appeal was dismissed, affirming the Commissioner (Appeals)' authority to remand cases under the Finance Act, 1994, despite restrictions under the Central Excise Act, 1944.