VCES declaration cannot be rejected without proved service, and a later challenge fails once the earlier appellate order is final.

A VCES declaration cannot be rejected where the department has not proved service of the relevant communication in the manner required by Section 37C of the Central Excise Act, 1944; without acknowledgement or proof of delivery, the letter cannot be treated as received, so the condition for invoking Section 106(2) of the Finance Act, 1994 is not met. A later challenge to the same declaration is also not maintainable once an earlier appellate order on that declaration has attained finality and no further appeal was filed against it.

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Issues: (i) Whether the Revenue's appeal against rejection of the VCES declaration was maintainable in view of the earlier appellate order having attained finality; (ii) whether the declaration could be rejected under Section 106(2) of the Finance Act, 1994 when the communication of the department's letter was not proved in the manner required by Section 37C of the Central Excise Act, 1944.

Issue (i): Whether the Revenue's appeal against rejection of the VCES declaration was maintainable in view of the earlier appellate order having attained finality.

Analysis: The dispute regarding the same VCES declaration had already been decided by the Commissioner (Appeals) in an earlier order, which allowed the assessee's appeal. No further appeal had been filed by the Revenue against that order. Once that order had attained finality, the subsequent appeal challenging the later order could not be maintained.

Conclusion: The appeal was not maintainable on account of the earlier final order.

Issue (ii): Whether the declaration could be rejected under Section 106(2) of the Finance Act, 1994 when the communication of the department's letter was not proved in the manner required by Section 37C of the Central Excise Act, 1944.

Analysis: Rejection of the VCES declaration depended upon the department establishing that the earlier letter had been duly served. Under Section 37C of the Central Excise Act, 1944, service by speed post requires proof of delivery. As no acknowledgement or proof of delivery was produced, the letter could not be treated as received by the respondent. In that situation, the condition for invoking Section 106(2) of the Finance Act, 1994 was not satisfied.

Conclusion: The declaration could not be rejected under Section 106(2) of the Finance Act, 1994.

Final Conclusion: The Revenue failed both on maintainability and on merits, and the order in favour of the assessee stood undisturbed.

Ratio Decidendi: Where prior appellate proceedings on the same declaration have attained finality, a later challenge is not maintainable, and rejection of a VCES declaration cannot rest on alleged service unless delivery is proved in accordance with the governing statutory mode of service.

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