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ST – Despatch of o-in-o by speed post would not amount to a valid service in the absence of proof of actual delivery – effort must be taken to realistically serve the same to enable party to initiate any permissible action: CESTAT

2019-TIOL-2248-CESTAT-KOL

IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, KOLKATA
EASTERN ZONAL BENCH, KOLKATA

Appeal No. ST/75166/2014

Arising out of Order-in-Appeal No.509/Pat/S.Tax/Appeal/2013, Dated: 19.12.2013
Passed by the Commissioner of Customs, Central Excise & Service Tax, Patna

Date of Hearing: 01.08.2018
Date of Decision: 01.08.2018

M/s NEW GOLDEN REFRIGERATION

Vs

COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX
PATNA

Appellant Rep by: Shri B N Chattopadhyay, Consultant
Respondent Rep by: Shri A Roy, Suptd. AR

CORAM: P K Choudhary, Member (J)

ST – The assessee is engaged in providing taxable services such as “maintenance and repair service” and “commission and installation service” – A SCN was issued to assessee alleging that they had contravened the provisions under Sections 67 and 68 of FA, 1994 r/w Rule 6 of Service Tax Rules – The assessee contends that the said adjudication order was never received by them – The Commissioner (A) has held that the adjudication order was sent to assessee by speed post on 10.12.12 and since the post had not been received back by adjudication authority, it was assumed that the said post had been duly delivered to the assessee – A Larger Bench of this Tribunal in case of Margra Industries Ltd. 2006-TIOL-1220-CESTAT-KOL had held that ‘Dispatch of adjudication order by speed post/registered post would not amount to a valid service in the absence of proof of actual delivery of speed post’ – It is pertinent to decide a matter with due notice to the concerned parties and that every effort must be taken to realistically serve such notice to the concerned parties, not only with an intention to ensure that the party has knowledge thereof but also to enable the party to initiate any permissible action – Therefore, the Commissioner (A) ought to have decided the assessee’s case on merits – Matter is remanded to the Commissioner (A) to be decided on merits: CESTAT

Matter remanded

Case laws cited:

Indore Municipal Corporation v. CCE (A) – 2016-TIOL-2747-HC-MP-CX…Para 3

Margra Industries Ltd. V. Commissioner of Customs – 2006-TIOL-1220-CESTAT-KOL…Para 4

FINAL ORDER NO. A/76973/2018

Per: P K Choudhary:

Briefly stated the facts of the case are that the Appellant is engaged in providing taxable services such as “maintenance and repair service” and “commission and installation service”. Pursuant to a departmental audit, Show Cause Notice dated 28.03.12 was issued to the Appellant alleging that the Appellant had contravened the provisions under Sections 67 and 68 of the Finance Act, 1994 read with Rule 6 of the Service Tax Rules. The Appellant failed to submit a reply to the Show Cause Notice and attend the personal hearing granted by the adjudicating authority. Therefore, an ex parte adjudication order dated 27.09.12 was passed against the Appellant. The Appellant contends that the said adjudication order was never received by the Appellant. Vide letter dated 26.04.13, the Appellant requested for a copy of the adjudication order which was provided to them vide covering letter dated 01.05.13. Subsequently, the Appellant filed an appeal before the Commissioner (Appeals) on 01.07.13 which was dismissed by the Commissioner (Appeals) vide Order-in-Appeal dated 19.12.13 on the ground of limitation. Aggrieved by the said order of the Commissioner (Appeals), the Appellant has filed an appeal before this Tribunal.

2. Heard both sides and perused the appeal records.

3. I find that the Commissioner (Appeals) has held that the adjudication order was sent to the Appellant by speed post on 10.12.12 and since the post had not been received back by the adjudication authority, it was assumed that the said post had been duly delivered to the Appellant. Further, the ld. AR for the Revenue has relied upon the decision of the Hon’ble Madhya Pradesh High Court in the case of Indore Municipal Corporation v. CCE (A), Indore reported in 2016 (338) ELT 567 (MP) = 2016-TIOL-2747-HC-MP-CX to contend that the burden is on the person to whom a post is sent to prove that the speed post sent by the Department was not delivered to him as provided under Section 37C(2) of the Central Excise Act, 1944. Section 37C is reproduced for reference:

“37C. Service of decisions, orders, summons, etc.- (1) Any decision or order passed or any summons or notices issued under this Act or the rules made thereunder, shall be served,-

(a) by tendering the decision, order summons or notice, or sending it by registered post with acknowledgement due, to the person for whom it is intended or his authorised agent, if any;

xxxxxxxxxxxxxx”

Section 37C(2) clearly states that an order passed under the Act shall be deemed to have been served on the date on which such order is delivered by post. However, merely stating that the post had not been received back by the sender does not establish that such post had been received by the intended receiver. Further, I find that the contention of the Department that the burden of proof is on the presumed receiver of a speed post to prove that such post was not received by him is illogical. On the contrary, the burden of proof should lie with the sender of the speed post to show that the post was indeed delivered to the intended receiver.

4. I find that a Larger Bench of this Tribunal in the case of Margra Industries Ltd. V. Commissioner of Customs, New Delhi reported in 2006 (202) ELT 244 (Tri.-LB) = 2006-TIOL-1220-CESTAT-KOL had held that ‘Dispatch of adjudication order by speed post/registered post would not amount to a valid service in the absence of proof of actual delivery of speed post’.

5. I am of the view that it is pertinent to decide a matter with due notice to the concerned parties and that every effort must be taken to realistically serve such notice to the concerned parties, not only with an intention to ensure that the party has knowledge thereof but also to enable the party to initiate any permissible action. In the instant case, the Appellant had filed an appeal before the Commissioner (Appeals) pursuant to receipt of the adjudication order by them. Therefore, the Commissioner (Appeals) ought to have decided the Appellant’s case on merits.

6. In view of the above discussion, the Appeal filed by the Appellant is remanded to the Commissioner (Appeals) to be decided on merits. Needless to mention, a reasonable opportunity of hearing be granted to the appellant to present their case. All issues are kept open and both sides are at liberty to produce evidences in their support.

(Operative portion of the order already pronounced in the open court)

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