2016 (12) TMI 851 - AT - Service Tax

Commissioner (Appeals) granted wide discretion to remand cases for re-adjudication under Finance Act, 1994

The Tribunal affirmed the authority of the Commissioner (Appeals) to remand cases for re-adjudication under Section 85 of the Finance Act, 1994, granting ... Jurisdiction of ld.Commissioner (Appeals) to remand the case - verification of the certificates of transporters in respect of payment of service tax - Held that: - this issue is no more res-integra and has been decided by the Principal Bench of this Tribunal in the case of Commr. of S.Tax Vs. Associated Hotels Ltd. [2014 (4) TMI 406 - GUJARAT HIGH COURT], where it was held that by virtue of sub-section (5) of section 85, the same limitation on the Commissioner (Appeals) to remand a proceedings contained in section 35A(3) of the Central Excise Act, 1944 must not apply in the appeals under section 85 of the Finance Act, 1944 also. Appeal rejected - decided against Revenue. Issues:- Challenge to the power of the Commissioner (Appeals) to remand the case- Objection to the direction to verify certificates of transporters for service tax payment- Interpretation of Section 85 of the Finance Act, 1994 regarding the power to remand proceedingsAnalysis:1. Challenge to the power of the Commissioner (Appeals) to remand the case:The Appellant-Revenue contested the authority of the Commissioner (Appeals) to remand the case to the Adjudicating Authority for re-adjudication. They argued that the Commissioner (Appeals) should have confirmed, modified, or annulled the decision instead of remanding the matter. However, it was noted that the issue has been previously settled by the Principal Bench of the Tribunal and the High Court of Gujarat. The High Court observed that the Commissioner (Appeals) does have the power to remand a case for fresh consideration under Section 85 of the Finance Act, 1994. Sub-section (4) of Section 85 provides the Commissioner (Appeals) with wide powers to pass orders as deemed fit, including remanding proceedings if necessary. Therefore, the Commissioner (Appeals) has the authority to remand a case for proper reasons without any specific limitation, as long as a reasonable opportunity is given to the affected party.2. Objection to the direction to verify certificates of transporters for service tax payment:The Appellant-Revenue also objected to the direction given by the lower appellate authority to the Adjudicating Authority to verify the certificates of transporters regarding the payment of service tax. However, the Tribunal found no fault in the impugned order based on the legal provisions and previous judgments. The Tribunal upheld that the Commissioner (Appeals) has the power to issue such directions as part of the re-adjudication process, and the appeal filed by the Revenue on this ground was rejected.3. Interpretation of Section 85 of the Finance Act, 1994 regarding the power to remand proceedings:The Tribunal extensively analyzed Section 85 of the Finance Act, 1994 to determine the scope of the Commissioner (Appeals)'s powers in hearing and disposing of appeals. It was clarified that the wide language of sub-section (4) of Section 85 grants the Commissioner (Appeals) ample powers to make necessary orders, including remanding proceedings for proper adjudication. The Tribunal emphasized that the appellate powers under Section 85 are not restricted by any specific limitation on remanding cases, and the Commissioner (Appeals) retains the authority to remand proceedings if deemed essential for a fair decision. The Tribunal's decision was aligned with the precedents set by the Tribunal and the High Court of Gujarat, confirming the Commissioner (Appeals)'s ability to remand cases under the provisions of the Finance Act, 1994.In conclusion, the Tribunal, following the established legal interpretations and precedents, upheld the power of the Commissioner (Appeals) to remand cases for re-adjudication and rejected the appeal filed by the Revenue, finding no legal flaw in the impugned order.