Tribunal voids Rectification of Mistake order due to non-disclosure, directs action to Bar Council

The Tribunal found that the non-disclosure of the Supreme Court's order constituted fraud, rendering the Rectification of Mistake (ROM) order void ab initio. Consequently, the Tribunal recalled the ROM order dated 02.08.2016, allowed the Revenue's Miscellaneous Application, and directed the order to be sent to the Bar Council of India for appropriate action. The appellant's deposit of Rs. 8 crores subsequent to the order did not impact the decision.

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Issues Involved:
1. Classification of services provided by the appellant.
2. Non-consideration of the limitation issue by the Tribunal.
3. Filing of an application for rectification of mistake (ROM) by the appellant.
4. Revenue's appeal against the ROM order.
5. Allegations of "forum shopping" and non-disclosure of the Supreme Court's order.

Detailed Analysis:

1. Classification of Services Provided by the Appellant:
The dispute regarding the classification of services provided by the appellant was initially referred to the Larger Bench in the case of Great Lakes Institute of Management Ltd vs. CST, Chennai. The Larger Bench's decision favored the Revenue, and the Tribunal adopted this decision, rejecting the appellant's appeal on merits in its Final Order dated 29.10.2015.

2. Non-Consideration of Limitation Issue by the Tribunal:
The appellant contended that the Tribunal, while disposing of the appeal on merits, failed to consider the limitation issue raised in the appeal memo and during the hearing. The appellant filed an application for rectification of mistake (ROM) under Section 35C(2) of the Central Excise Act, 1944, arguing that the non-consideration of the limitation issue amounted to a mistake requiring rectification.

3. Filing of Application for Rectification of Mistake (ROM) by the Appellant:
The ROM application was listed and decided on 02.08.2016. The Tribunal acknowledged the omission of the limitation issue and agreed that it constituted a mistake. Consequently, the Tribunal rectified the error, holding that the demand was barred by limitation due to the absence of any suppression or mala fide on the part of the assessee.

4. Revenue's Appeal Against the ROM Order:
The Revenue challenged the ROM order, arguing that the Tribunal had become functus officio after its final order on 29.10.2015 and lacked jurisdiction to entertain the ROM application. They contended that the pendency of the appeal before the Supreme Court and the directions for depositing the service tax and interest were not disclosed to the Tribunal, constituting a failure of full disclosure. The Revenue cited Supreme Court decisions disapproving "forum shopping" and argued that the Tribunal's order on the ROM should be recalled.

5. Allegations of "Forum Shopping" and Non-Disclosure of the Supreme Court's Order:
The appellant's advocate countered the Revenue's allegations, asserting that the ROM application and the appeal before the Supreme Court operated in different arenas and did not constitute "forum shopping." The advocate admitted the non-disclosure of the Supreme Court's order was an unintentional mistake and emphasized that the Departmental Representative and the Tribunal's Registry were also aware of the order. The Tribunal, however, held that the non-disclosure of the Supreme Court's proceedings amounted to fraud, vitiating the ROM order dated 02.08.2016.

Conclusion:
The Tribunal concluded that the non-disclosure of the Supreme Court's order constituted fraud, rendering the ROM order void ab initio. The Tribunal invoked its inherent powers to recall the ROM order dated 02.08.2016 and allowed the Revenue's Miscellaneous Application. The Tribunal also directed that a copy of the order be sent to the Bar Council of India for appropriate action. The appellant's subsequent deposit of Rs. 8 crores did not alter the situation.

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