2010 (5) TMI 81 - AT - Service Tax

Appeal on Cenvat Credit for Service Tax Disallowed Due to Procedural Non-Compliance

The appeal addressed the eligibility of cenvat credit for service tax paid on goods transport service. The Commissioner's decision favored the appellant ... Appeal - commissioner of central excise to file an appeal - In view of the fact that there is no Commissionerate at Valsad, there cannot be a Commissioner of Central Excise Valsad and therefore even if the defect has to be rectified, it would not be possible since there is no Commissioner at Valsad.Held that: . Therefore defect cannot be rectified. In view of the fact that appeal has been filed in form meant for service tax appeal and in respect of a manufacturer who had availed cenvat credit and it should have been filed under Central Excise Act and during the relevant time there was no Commissionerate at Valsad at all, the appeal becomes not maintainable under the law and accordingly the same is rejected. Issues:1. Eligibility of cenvat credit on service tax paid for goods transport service.2. Correct appeal procedure under the Central Excise Act, 1944.3. Constitution of the committee of Commissioners for appeal authorization.Eligibility of Cenvat Credit:The appeal addressed the eligibility of cenvat credit amounting to Rs.4,72,167/- for service tax paid on goods transport service. The Commissioner's decision favored the appellant, citing the precedent set by the Larger Bench of the Tribunal in a specific case. However, the advocate for the respondents contended that the appeal should have been filed under Section 35 B of the Central Excise Act, 1944, as the appellant was a manufacturer of excisable goods. The advocate raised concerns about the procedural aspect and highlighted the absence of a legally constituted committee of Commissioners, crucial for appeal authorization. The issue revolved around the proper classification of the appeal and the reliance on the Tribunal's decision for determining cenvat credit eligibility.Correct Appeal Procedure:The advocate for the respondents emphasized the necessity of filing the appeal under the appropriate section of the Central Excise Act, 1944, specifically Section 35 B. The contention was that the appeal had been incorrectly filed using form ST-7 meant for service tax appeals instead of the required procedure for excisable goods manufacturers. Furthermore, the absence of a Commissioner of Central Excise Valsad, as mandated by Notification No.25/2005-CE, raised concerns about the validity of the appeal process. The advocate supported this argument by referencing previous Tribunal decisions that emphasized the significance of appeals being authorized by a legally constituted committee of Commissioners. The issue highlighted the importance of adhering to the correct appeal procedure as per the relevant legislation and notifications.Constitution of Committee of Commissioners:The advocate's argument also focused on the composition of the committee of Commissioners required for appeal authorization. The absence of a Commissioner of Central Excise Valsad, as stipulated in the notification, posed a challenge to rectifying any procedural defects in the appeal process. Despite a subsequent notification reconstituting the committee, the lack of retrospective effect rendered the rectification of the defect impossible. This issue underscored the importance of the proper constitution of the committee of Commissioners for authorizing appeals and the implications of any discrepancies in the committee's composition on the appeal's maintainability. The judgment ultimately rejected the appeal due to procedural non-compliance related to the constitution of the committee of Commissioners.In conclusion, the judgment delved into the complex interplay of cenvat credit eligibility, correct appeal procedures under the Central Excise Act, 1944, and the constitution of the committee of Commissioners for appeal authorization. The decision hinged on the procedural intricacies and compliance requirements, ultimately leading to the rejection of the appeal based on the identified non-compliances and defects in the appeal process.