Custom, Excise & Service Tax Tribunal
M/S Bsbk Ltd vs Cce, Raipur on 12 April, 2013
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
West Block No. 2, R.K. Puram, New Delhi 110 066.
ST/Stay Nos. 1700 & 1723/2012
ST/Appeal Nos. 711 & 714/2012
(Arising out of the both order in original Nos. Comm /RPR /Cex/De -novo/14/15/2012 dated 29.2.2012 passed by the Commissioner of Customs & Central Excise, Raipur)
Date of Hearing : 5.6.2012
For Approval & Signature :
Honble Mrs. Archana Wadhwa, Member (Judicial)
Honble Mr. Mathew John, Member (Technical)
1.
Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2.
Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3.
Whether their Whether their Lordships wish to see the fair copy of the order?
4.
Whether order is to be circulated to the Department Authorities?
M/s BSBK Ltd. Appellant
Vs
CCE, Raipur Respondent
Appeared for the Appellant: Shri Huzefa Ahmadi, Advocate Shri Sanjay Grover, Advocate Appeared for the Respondent: Shri K.P. Singh, SDR Coram: Hon'ble Mrs. Archana Wadhwa, Member(Judicial) Hon'ble Shri Mathew John, Member (Technical) Final ORDER No. 56383-56384/2013 Per Archana Wadhwa:
It is seen that in Appeal No. 711/12 the impugned order stand passed by the Commissioner in de-novo proceedings, when the matter was remanded by the Tribunal vide its Final Order No. 267/09 dated 30.10.09.
2. The learned Advocate appearing for the appellants submits that the said order of the Tribunal remanding the matter was put to challenge before the Hon'ble Supreme Court who vide their order dated 19.2.10, issued notice to the respondents and thereafter the appeal was admitted on 8.7.10, as per the statement made by the learned Advocate.
3. It is seen from the order of the Hon'ble Supreme Court that the their contention that even if the departments allegation of running a commercial and industrial construction services and erection and commissioning services are accepted, still there would be no demand liable to be paid by the appellants.
4. Learned Advocate submits that the above development was brought to the notice of the Commissioner and a request was made to keep the proceedings in abeyance till the decision of Hon'ble Supreme Court comes but the learned adjudicating authority has passed the impugned order, without considering their request and without affording opportunity of personal hearing to them. In view of the above, it is the contention of the learned Advocate that the matter be remanded to Commissioner for passing orders, after the decision of the Hon'ble Supreme Court on their appeal pending before the Hon'ble Supreme Court.
5. We note that the Commissioner has to pass order in de-novo proceedings in terms of the direction as contained in the remand order of the Tribunal. The appeal against the said order is admitted by the Supreme Court. As such, it can be safely concluded that the entire issue is before the Hon'ble Supreme Court. Though we note that there is no stay of operation of the Tribunals remand order but to avoid multiplicity of proceedings, it is better if the Commissioner would have waited for the outcome of the appeal pending before the Hon'ble Supreme Court in as much as, it is the same very order of the Tribunal vide which the matter was remanded to the Commissioner which is the subject matter of appeal before the Hon'ble Supreme Court. As such, we agree with the learned Advocate that the Commissioner should have kept the proceedings in abeyance instead of going ahead with the direction of Tribunal to re-adjudicate the matter when the order of the Tribunal was subject matter of appeal before the Hon'ble Supreme Court.
6. In Appeal No. 714/12 though we note that there is no development as regards passing of any remand order of the Tribunal, but the fact remains that the issue involved is identical and for a subsequent period. As such, our observations that when the issue is pending before the Hon'ble Supreme Court in respect of the same assessee involving the same issue, it would be better to wait the outcome of the appeal.
7. In view of the above, after dispensing with pre-deposit, we set aside the impugned order and remand the matter to Commissioner to decide the same after issue is decided by the Hon'ble Supreme Court. We make it clear that this is to avoid multiplicity of proceedings at various levels. Both the stay petitions as also appeals are disposed of in the above manner.
(Order dictated and pronounced in the open Court.) (MATHEW JOHN) (ARCHANA WADHWA) Member (Technical) Member (Judicial) MPS*
8. After the above order was dictated by Member (Judicial) in the court, I had made it clear that I was not in agreement with certain parts of the order and I will be deciding my order after going through the file in a more detailed manner. This order is being recorded in pursuance of such fact pronounced in the Court.
9. I have heard the arguments during the hearing, perused the case records and also considered the order recorded by Member (Judicial). Though I am in agreement with the order of Member (Judicial) that the matter has to be remitted for de-novo consideration. I am not in agreement with the direction of Member (Judicial) that the matter should be kept pending by the adjudicating officer till the appeal filed by the Appellant against the previous order of the Tribunal, directing fresh adjudication, is decided by the Honorable Apex Court. I am recording this separate order for that reason. Firstly I propose to state the reasons why I agree that this matter has to be remitted back to the adjudicating authority. Then I propose to record the reason why I disagree with the order that the matter should be kept pending.
10. The facts of the case are that the appellant was providing different services to steel plants. According to them the services were divisible in the following categories:
(a) Commercial or Industrial Construction Service;
(b) Erection, Commissioning or Installation Service;
(c) Consulting Engineers Service.
11. On the first two services, abatement from value of services to the extent of 67% available under Notification 1/2006-ST and tax need be paid only on the balance value of tax. In the case of third service tax need be paid on the full value of the service. If abatement is to be availed Cenvat Credit on inputs, capital goods and input services used in providing such service cannot be availed. This is a restriction with reference to the service for which abatement is claimed and not with reference to all the service provided by the service provider.
12. There is also Notification 12/2003-ST under which the appellant can claim exemption from value of services to the extent of value of goods sold while providing service. This exemption is applicable for all services. If abatement under Notf 1/-2006 ST is to be availed then notification 12/2003-ST cannot be availed.
13. The dispute is centered on the issue whether the contracts were divisible, if divisible, whether they could have availed abatement, Cenvat credit in respect of inputs, capital goods and input services used for providing Consulting Engineers Service, whether the appellants have maintained accounts to show credit taken separately for the three services, etc.
14. The matter was adjudicated once. The adjudication was done without examining all the issues involved. So the Tribunal passed two orders in this regard. The first order sought to ascertain some information and the second order set aside the impugned order and remanded the matter for adjudicating the case afresh. The relevant paragraphs are re-produced below:
Extracts from Miscellaneous Order dated 25.8.2009 4. In view of the rival submissions of both sides, for the factual examination required, we do not propose to pass any order for pre-deposit today. It is in the interest of justice that result of following questions is required to be reported by Revenue to the Bench on 18th September, 2009:-
(1) Whether there are separate set of records maintained by the appellant to record different contracts distinctly and receipt and expenditure for each such contract recorded separately;
(2) Whether distinct records are maintained to show the source of input credit with amount for appropriation against service tax liability in respect of such distinct service provided as per page 4 of the appeal memo;
(3) Whether there is any allocation register maintained to allocate the input credit to the respective service provided;
(4) Whether substance of page 74-75 of the appeal folder (Annexure J to show cause notice) gives rise to input credit of Rs. 6,02,867/- as appearing in Col. 5 at page 18 of the appeal folder and whether that was appropriated against tax liability relating to Consulting Engineer Service;
(5) Whether any input credit has been claimed against Industrial and Construction services. Extracts from Final Order dated 30.10.2009 5. On careful consideration of the submissions from both sides and on perusal of the records including the verification report submitted in pursuance of the order dated 17.8.09, we find that several submissions made by the appellants in the reply to the notice have not been considered in proper perspective. The crucial question is whether the appellants have rendered separate services of Consulting Engineer Service and the same has not been dealt. The submissions contained in the report of the various questions raised by the Tribunal should have been dealt with in the order of original authority. The order of the Commissioner as already observed in the order of the Tribunal dated 17.8.09, appears cryptic and does not deal with all the issues adequately with reference to the various submissions made by the appellants. The order cannot be held to be speaking. In view of the above, we deem it proper to set aside the order of the Commissioner and remand the matter to the Commissioner for fresh consideration. We permit the appellants to make further submissions, if any, along with evidences in support of their submission within 45 days from the date of receipt of this order. The Commissioner thereafter shall decide the issues afresh after granting the reasonable opportunity of hearing to the appellants.
15. The appellant filed an appeal before the Supreme Court. The appeal is admitted by the Apex Court vide order dated 23-04-10. No stay was granted against the order dated 31-10-09 of the Tribunal. In denovo proceedings before the adjudicating authority, the appellant did not file submissions or appear for hearing on the ground that they have filed appeal before the Apex Court. So the Adjudicating authority passed the order without hearing them. Such order is before challenge in the present proceeding before the Tribunal.
16. What I notice is that the Tribunal observed that the critical question is whether the appellants have rendered separate services. That issue has not been examined in the first order. In denovo proceedings also the authority has not dealt with this issue. According to him the only issue to be decided in this case relates as to whether the appellant are entitled for abatement provided under Notification 1/2006-ST dated 01-03-2006 (Refer para 6.5 of the order). He has ignored the issues raised by the Tribunal in orders dated 25-08-09 and 30-10-2009. Further the directions to give an opportunity to the appellant for a hearing is not complied with. An adjudicating authority cannot give this opportunity if the appellant is not willing to avail of this opportunity. The submission of the appellant before Tribunal is that if they were told that the adjudicating authority was going to decide the case notwithstanding the appeal before Supreme Court, they would have availed of the opportunity. May be grudgingly. I am willing to give the benefit of doubt and give another opportunity to the appellant to make submissions and be heard. There are critical issues of facts to be examined and once decision is taken without hearing the party there is likelihood of erroneous conclusion. I am of the view that in this case there was need to give a longer rope of natural justice to the appellant till it became explicit that they were just not willing to make any submission. So I am agreeing with the order for remanding the case for another round of adjudication and I agree with that part of the order recorded by Member (J).
17. Now I come to the reasons why I am not agreeing with the order to keep the matter in abeyance till the Apex Court decides the appeal before it. In the first place the order recorded by Member (Judicial), in substance amounts to temporarily stopping the proper implementation of the order of the Tribunal dated 31-10-2009 which could not be carried out properly due to non-co-operation of the appellants. When the appellants filed appeal before Apex Court, it was open to the appellants to request the Apex Court to stay the order of the Tribunal. The appellants did not either pray for stay or the Hon Apex Court did not grant it. Since the order of the Tribunal was not stayed by the Apex Court, the most reasonable inference is that the Apex Court has noted that the matter is remanded for de-novo consideration and the results of de-novo proceedings may be of use in deciding the matter before the Hon. Apex Court as and when the matter is taken up for final hearing by the Hon. Apex Court. In either case, it is not proper for the Tribunal to pass such order stopping further proceedings by the adjudicating authority when Apex Court did not do so. What the Tribunal should do at this stage is to ensure proper implementation of the order already passed and not stopping further proceedings in pursuance of the order. So I do not agree with the order recorded by Member (J).
18. There are some more relevant facts. As per the submission of the appellant their argument before the Apex Court as seen from order in Civil Appeal No. 1418 of 2010 dated 19-12-2010 reading as under:
Issue notice, limited to the question which is raised in this civil appeal.
It is the case of the assesse that even if the Department is right in its contention namely that the assesse has not rendered Consulting Engineers Service (CES) even in that event, the assessee has paid excess tax in view of the fact that the assesse has not taken the benefit of abatement.
19. It is very obvious that this issue requires verification of facts. If the facts relating to such contention are examined by the adjudicating authority as a finding on the pleading that the appellants may raise before the adjudicating authority with supporting evidence, it will become a very simple issue for the Apex Court to dispose of finally. So I do not see any reason why this finding on fact should be stopped by the Tribunal through an order for the issue of which the Tribunal has no power as already explained in para 16 above. So I disagree with that part of the order advising the adjudicating authority to keep the matter pending. I would rather record an advice that the appellant should place records before the adjudicating authority as are relevant for deciding their contentions before the Apex Court. If the finding of the adjudicating authority is in favor of the appellant the precious time of Apex Court gets saved and it is a very desirable outcome.
20. I am also of the view that the difference in opinion between Member (J) and me that has arisen does not involve any question of fact or law but only advice regarding future course of action and hence the order can be issued for the agreed part of the order without reference to a third Member.
(Mathew John) Member (Technical)
19. POINTS OF DIFFERENCE In the facts and circumstances of the case whether it is legal and proper,-
to give a direction to the adjudicating authority that the matter should be kept pending till the Apex Court decides the appeal filed before it as directed by Member (Judicial) OR to give a direction to the appellant to take all pleadings along with supporting evidence before the adjudicating authority directing him to decide the issues afresh as per the remand order already passed by the Tribunal as opined by Member (Technical) (Pronounced in Court on 14.06.2012) (Archana Wadhwa) Member(Judicial) (Mathew John) Member(Technical)
20. The Registry may place the matter before the President, CESTAT for deciding whether the order can be issued only for the agreed part of the order or the point of difference need to be resolved by a third Member before issue of the order and if found necessary to take steps to resolve the point of difference.
(Archana Wadhwa) Member(Judicial) (Mathew John) MPS* Member(Technical) PER: D.N.PANDA
21. When the appellant came in appeal against de-novo adjudication order No.RPR/CEX-De-NOVO/14/2012 dated 29.02.2012, on consideration of the fact that such de-novo adjudication arose out of remand order passed vide final order No.ST/267/09 dated 30th October, 2009 by the Tribunal and such remand order of the Tribunal was challenged by Appellant before Apex Court in Civil Appeal No.1418/10, it was the opinion of the ld. Judicial Member that the matter should go back to the ld. Adjudicating Authority to decide the issue after disposal of the Civil Appeal by Apex Court. But ld. Technical Member opined that ld. Adjudicating Authority should not keep the matter pending with him but should dispose the matter considering pleading of the appellant with the evidence.
22. Due to aforesaid difference of opinion, following question arose for reference to third Member:-
In the facts and circumstances of the case whether it is legal and proper:-
to give a direction to the adjudicating authority that the matter should be kept pending till the Apex Court decides the appeal filed before it as directed by Member (Judicial) OR to give a direction to the appellant to take all pleadings along with supporting evidence before the adjudicating authority directing him to decide the issues afresh as per the remand order already passed by the Tribunal as opined by Member (Technical)
23. The reference being on very narrow compass it can be instantly disposed with an opinion that both the Members having agreed for the remand of the matter arising out of de-novo adjudication, it is fair to allow ld. adjudicating authority to exercise his power judiciously in accordance with law without encroaching over his powers. It may be stated that Tribunal as a creature of statute has no power to bring a statutory proceeding to halt by its whim and statutory authorities should be allowed to act in their jurisdiction in accordance with law.
24. Ld. Technical Member in his detailed order recorded the fact that the pith and substance of the matter needs re-examination because the dispute centres round the issue whether the contracts were divisible, if divisible whether abatement and cenvat credit in respect of inputs, capital goods and input services used for providing consulting engineers services available and whether the appellant maintained accounts to show credit taken separately for the impugned services. He recorded the observations of Tribunal in para 16 of his order and opined that the appellant should have a fair opportunity to place its facts with evidence for thread bare examination in re-adjudication upon remand suggested by both Members.
25. It may be stated that there is no stay of operation of the order dated 30th October 2009 passed by the Tribunal by Apex Court in Civil Appeal No.1418 of 2010 which is agreed by ld. Counsel for the appellant on the date of hearing.
26. The reference is thus answered that the matter may go back to ld. Commissioner who shall grant fair opportunity of hearing to the appellant for pleading on fact, evidence and law for passing a reasoned and speaking order dealing entire pleading that may be made by the appellant. While passing the order if order of Apex Court comes up, ld. Commissioner shall have advantage of following that order.
27. Reference is disposed accordingly. Registry is directed to place the matter before the appropriate Bench for disposal of the appeal.
[Pronounced in the open Court on 12.04.2013].
(D.N.PANDA) JUDICIAL MEMBER Anita Final Order No.
28. In view of the majority order, the impugned order is set aside and the matter remanded to the Commissioner for afresh adjudication after taking into account all the evidence produced by the appellant and to pass appropriate order accordingly.
( Archana Wadhwa ) Member(Judicial)
( Mathew John )
Member(Technical)
ss
??
??
??
??
6
5