2023 (6) TMI 294 - AT - Central Excise

Appeal allowed due to timely filing, order service not proven. Case remanded for refund claim review.

The Tribunal allowed the appeal, finding that the appellant timely filed within the statutory limitation period. The Respondent failed to prove the order ... Maintainability of appeal - time limitation - refund claim on account of value addition deductions for the period of June, July and September 2014 - HELD THAT:- The respondent has not been able to produce any material conclusively showing that the order dated 25.03.2019 was served on the same day i.e. 25.03.2019 itself. The dispatch register produced by the respondent only shows the dispatch and there is no material on record showing that the appellant was served the copy of the order on 25.03.2019 itself - Moreover, the authorized representative of the company Jugal Kishore Sharma has filed the affidavit stating that he got the copy of the said order by hand on 18.06.2019 and the same was communicated to the company on 22.06.2019 and thereafter admittedly the appeal was filed within the statutory period of limitation. The dismissal of the appeal on limitation is not sustainable in law - case remanded back to the Commissioner (Appeal) with the direction to decide the appeal on merits - appeal allowed by way of remand. ISSUES PRESENTED AND CONSIDERED 1. Whether the Commissioner (Appeals) was justified in dismissing the departmental appeal as time-barred without verifying or adjudicating the factual question of service/receipt of the original order. 2. Whether the dispatch register entries produced by the department constitute conclusive proof of service of the order on the date of dispatch for the purpose of computing limitation under Section 35 of the Central Excise Act, 1944. 3. Whether an affidavit by an authorized signatory claiming later receipt of the order and subsequent communication to the company can rebut the departmental record and entitle the appellant to have the appeal decided on merits. ISSUE-WISE DETAILED ANALYSIS Issue 1: Validity of dismissal on limitation without adjudicating disputed service facts Legal framework: The limitation period for filing an appeal under Section 35 of the Central Excise Act, 1944 runs from the date of service/communication of the order. Determination of the date of communication is a factual prerequisite to the jurisdictional question of whether an appeal is time-barred. Precedent Treatment: The Tribunal treats factual disputes about service/receipt of orders as matters requiring consideration of available evidence; summary dismissal on limitation without examining such evidence is not appropriate where contesting material is placed before the appellate authority. Interpretation and reasoning: The Commissioner (Appeals) dismissed the appeal solely on the basis of the original authority's report and dispatch register entries, without independently examining or testing the appellant's sworn assertion and supporting affidavit regarding actual receipt and internal communication dates. The Tribunal found the departmental material did not conclusively establish service on the date of dispatch; the dispatch register only evidences dispatch, not actual receipt by the appellant. In contrast, the appellant produced an affidavit of the authorized signatory asserting receipt on a later date and showing internal communication thereafter, which, prima facie, created a triable factual dispute. Given that the dismissal on limitation extinguished the appellant's right to have the appeal heard on merits, the appellate authority ought to have resolved the factual dispute before applying limitation as a bar. Ratio vs. Obiter: Ratio - Where a factual dispute exists as to the date of service/communication of an order, an appellate authority must examine the evidence rather than dismissing the appeal on limitation solely on the basis of the original authority's dispatch register. Obiter - None material beyond application of the principle to the record before the Tribunal. Conclusion: The summary dismissal of the appeal on limitation without adjudicating the disputed fact of service was unsustainable; the matter must be remanded for adjudication on merits after proper consideration of the competing evidentiary material. Issue 2: Evidentiary value of dispatch register entries as proof of service for limitation purposes Legal framework: Proof of service/communication of an order for limitation purposes depends on demonstrable delivery or reliable evidence that the addressee received the order; documentary entries showing dispatch are relevant but do not invariably amount to conclusive proof of receipt. Precedent Treatment: Administrative records such as dispatch registers are admissible evidence of dispatch but are not conclusive on the question of receipt where contradicted by credible evidence of late receipt or absence of delivery; courts and tribunals assess dispatch entries against other evidence including affidavits, acknowledgment receipts, postal records, or conduct of parties. Interpretation and reasoning: The dispatch register produced by the department merely recorded the act of dispatch and a signature in the register; there was no corroborating material to establish that the appellant or its authorized agent actually received the order on the date of dispatch. The Tribunal emphasized that a signature in a dispatch register is not equivalent to an acknowledgment of receipt by the addressee. Where the appellant presented an affidavit asserting receipt on a later date and explained internal communication delays due to closure of the unit, the departmental dispatch entry could not be accepted as conclusive proof to commence limitation from the date of dispatch without further inquiry. Ratio vs. Obiter: Ratio - Dispatch register entries do not constitute conclusive proof of service/communication for limitation purposes where there is credible contrary evidence and no direct proof of delivery to the addressee. Obiter - The extent of inquiry necessary depends on circumstances and available corroborative material. Conclusion: The dispatch register alone was insufficient to establish service on the date of dispatch; the disputed question required further examination before applying limitation. Issue 3: Efficacy of an affidavit by an authorized signatory to rebut departmental proof of service and entitle merits adjudication Legal framework: Affidavits by authorized representatives are admissible evidence to establish facts such as date of receipt and internal communication; such evidence can rebut administrative records and, if credible and not inherently improbable, warrants further consideration rather than summary rejection. Precedent Treatment: Where an appellant places on record an affidavit detailing the circumstances of non-receipt or delayed receipt and such affidavit is not credibly impeached by the department, appellate authorities should accept the existence of a prima facie dispute and proceed to adjudicate the appeal on merits after appropriate enquiry. Interpretation and reasoning: The appellant filed an affidavit by the authorized signatory asserting receipt on 18.06.2019 and internal communication on 22.06.2019, with subsequent filing of the appeal within the statutory period. The Tribunal found no material produced by the department to conclusively contradict the affidavit. In absence of conclusive departmental proof and given the potential prejudice from denying merits adjudication, the affidavit was sufficient to raise a triable issue entitling the appellant to have the appeal heard on merits. The Commissioner (Appeals) erred in treating the original authority's report as dispositive without testing the appellant's contemporaneous evidence. Ratio vs. Obiter: Ratio - A credible affidavit by an authorized signatory alleging later receipt and internal communication can rebut administrative dispatch records and necessitate adjudication on merits rather than summary dismissal on limitation. Obiter - The weight to be accorded to such affidavits may depend on corroborative material and the overall record. Conclusion: The appellant's affidavit created a legitimate factual dispute as to service; in absence of conclusive contrary proof, the appeal could not be dismissed on limitation and must be remanded for merits determination. Disposition and Direction (connected to the foregoing issues) Because the department failed to produce conclusive evidence of service on the dispatch date and the appellant produced sworn evidence of later receipt, the Tribunal set aside the impugned order dismissing the appeal on limitation and remanded the matter to the Commissioner (Appeals) with direction to decide the appeal on merits after appropriate consideration of records and evidence. This remedial direction follows from the requirement that an appellant should not be deprived of adjudication on merits where a genuine dispute on service/limitation exists.