Court overturns dismissal orders, directs appeal review. Petitioner fined Rs.20,000, waives interest, must pay within two weeks.

The Court set aside the CESTAT's dismissal orders and directed a decision on the appeal's merits. The Petitioner agreed not to claim interest for the appeal period and was fined Rs.20,000 for lack of diligence, payable to the "Bar Council of Delhi- Indigent & Disabled Lawyers Account" within two weeks.

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Issues Involved:
1. Refund of Service Tax paid twice.
2. Rejection of refund application by Order-in-Original (OIO) and Order-in-Appeal (OIA).
3. Dismissal of Appeal by CESTAT for non-prosecution.
4. Dismissal of Restoration Application by CESTAT.
5. Violation of principles of natural justice.

Detailed Analysis:

1. Refund of Service Tax Paid Twice:
The Petitioner sought a refund of Service Tax amounting to Rs.39,09,130/-, which was paid twice'first via challan dated 06.05.2010 and then through CENVAT Credit. The Petitioner applied for a refund on 04.05.2011 under Section 11B of the Central Excise Act, 1944.

2. Rejection of Refund Application by OIO and OIA:
The refund application was rejected by the Respondent No. 2 through the Order-in-Original dated 28.06.2013, stating that the Petitioner should not have debited the same amount from its CENVAT Credit Account after opting to discharge Service Tax liability through a challan. The Petitioner's appeal against this order was also rejected by the Commissioner (Appeals) via Order-in-Appeal dated 30.04.2014.

3. Dismissal of Appeal by CESTAT for Non-Prosecution:
The Petitioner filed an appeal before the CESTAT on 28.07.2014, which was registered as ST No. 54605/2014. The Petitioner claimed it did not receive any notice for the hearing and later discovered that the appeal was dismissed on 16.10.2014 for non-prosecution. The Final Order indicated that the hearing notice was returned unserved with the remark "addressee not known."

4. Dismissal of Restoration Application by CESTAT:
The Petitioner applied for restoration of the appeal on 27.09.2019. The Restoration Application was dismissed by the CESTAT on 13.11.2019 for non-prosecution and failure to show sufficient cause. The Petitioner claimed it did not receive any communication regarding the hearing notice for the Restoration Application.

5. Violation of Principles of Natural Justice:
The Petitioner argued that the CESTAT's orders were passed without affording an opportunity of being heard, violating the principles of natural justice. The Court noted that the CESTAT did not hear the matter on merits and dismissed the appeal for non-prosecution. The Court referenced the Supreme Court's decision in Balaji Steel Re-Rolling Mills v. Commissioner of C. Ex. & Customs, which held that the Tribunal must decide appeals on merits and cannot dismiss them for want of prosecution.

Judgment:
The Court set aside the CESTAT's orders dated 16.10.2014 and 13.11.2019, directing the CESTAT to decide the Petitioner's appeal on merits. The Petitioner agreed not to claim interest for the period between the filing of the appeal and the Restoration-Dismissal Order. The Court imposed costs of Rs.20,000/- on the Petitioner for not diligently pursuing the appeal, to be paid to the "Bar Council of Delhi- Indigent & Disabled Lawyers Account" within two weeks.

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