TMI Blog2015 (6) TMI 787X X X X Extracts X X X X X X X X Extracts X X X X ..... respondent has been described as a designated authority, however, a perusal of the order, dated 15.11.2013 passed by him clearly shows that he has dealt with the issue on merits regarding the eligibility of the assessee/petitioner to avail the VCES scheme and passed a detailed order, dated 15.11.2013 holding that since the petitioner had been issued with show cause notice dated 8.2.2012 demanding service tax of ₹ 21,44,299/- for the period from 1.4.2007 to 31.3.2011, which was confirmed vide original order, dated 28.3.2013 and as such in terms of Section 106(2) of the Act, 1994 and in view of Circular Nos.169 and 170, dated 13.5.2013 and 8.8.2013, the petitioner is not entitled to avail the said scheme. Therefore, when the authority, the second respondent herein has given such a categorical finding on going through the facts and circumstances of the case by applying his mind, his decision, in my considered opinion, would fall within the meaning of adjudication which is meant by settled law that giving or pronouncing a decision or order judicially and thereby, I have no hesitation to hold that the second respondent has acted as an adjudicating authority and not as a desig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rity to waive the proposed interest, penalty and to pay the tax in installments. 2. The Additional Commissioner of Central Excise passed an order dated 28.03.2013 demanding service tax of ₹ 21,44,299/- u/s 75 of the Act with recovery of interest u/s 75 of the Act, penalty of ₹ 200/- per day for non-registration of their service u/s 77[1][a] of the Act from the first day till the date of compliance along with penalty of ₹ 5,000/- u/s 77[2] and penalty of ₹ 21,44,299/- u/s 78 of the Act. 3. Aggrieved by the said order, the petitioner preferred an appeal and the 1st respondent vide order dated 27.08.2013, modified the said order by allowing the deduction of the tax. In the meantime, the Government introduced a onetime scheme known as Service Tax Voluntary Compliance Encouragement Scheme, 2013 [ in short, VCES ] which enables to pay tax dues in two installments subject to certain conditions. To avail the benefits of the scheme, the petitioner submitted a declaration dated 07.10.2013 u/s 107[1] of the Act to the 2nd respondent. The 2nd respondent called upon the petitioner to submit its reply as to why the declaration should not be rejected u/s 106[1] of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce dated 8.12.2012. Therefore, when there had been a notice demanding service tax liability from the petitioner, the petitioner is not entitled to file a declaration under the VCES. Though VCES introduced by way of amendment made by the Finance Bill, 2003, it does not mean that all the provisions of the Act, 1994 are applicable to the scheme. It is also stated that as per Section 85 of the Act, 1994 an appeal can be preferred to the Commissioner (Appeals) against any decision or order passed by an adjudicating authority. But in the present case, the second respondent is not an adjudicating authority, but for the purpose of scheme, he acted only as a designated authority for accepting or rejecting the declaration of the assessee. If the assessee complies with Section 106, he can proceed under Section 107 for submitting the declaration as prescribed in it. In this case, Section 106 itself prevented the petitioner from filing declaration under the scheme for availing the benefits. The second respondent acted as designated authority and he is not empowered to decide any lis. Therefore, the order of the first respondent returning the appeal is valid in law and therefore, the respond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave a statutory provision for filing appeal against the order of rejection of declaration under Section 106(2) passed by the designated authority and that the appeal preferred by the petitioner under Section 85 of the Act, 1994 would not lie since the said provision provides appeal only as against the orders passed by the adjudicating authority and in the present case, the 2nd respondent who passed rejection order, cannot be construed as an adjudicating authority, but only as a designated authority. 11. In similar circumstances, the Punjab and Haryana High Court, in its decision in M/s.Barnala Builders s case, (cited supra), has categorically held that the order passed under VCES is appealable. It has been held so as under: The impugned order, in our considered opinion, is appealable, under Section 86 of the Indian Finance Act, 1994, particularly as the scheme under which the petitioner has applied, is part and parcel of the aforesaid Finance Act, by virtue of the Indian Finance Act, 2013. Faced with this situation, counsel for the petitioner has pressed into service circular, dated 08.08.2013, issued by the Central Board of Excise and Customs, stating that such an order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but does not include the Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963, Collector of Central Excise (Appeals) or Appellate Tribunal. 15. Section 65B (55) of the Act, 1994 states as under: Words and expressions used but not defined in this Chapter and defined in the Central Excise Act, 1944 or the rules made thereunder, shall apply, so far as may be, in relation to service tax as they apply in relation to a duty of excise. 16. Therefore, in terms of Section 65B (55) of the Act, 1994, the definition adjudicating authority available under Section 2(a) of the Central Excises and Salt Act, 1944 would equally apply to the Act, 1994. Now it is to be seen that whether the second respondent, the Assistant Commissioner of Central Excise, has acted as an adjudicating authority or as a designated authority? 17. It is pertinent to note that though the second respondent has been described as a designated authority, however, a perusal of the order, dated 15.11.2013 passed by him clearly shows that he has dealt with the issue on merits regarding the eligibility of the assessee/petitioner to avail the VCES scheme and passed a detailed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... human and hence it cannot be expected that all the decision makers would be perfect in their approach in arriving at just conclusions. If any statute or scheme does not make the appeal provision, it would be nothing to mean that the order passed by the authority has become final and conclusive for all the purposes and thereby, giving uncontrolled and unquestionable powers to the said authority by virtue of which, he becomes as monopoly over the statute and will certainly act in an arrogant manner. In this case, the second respondent is the original authority, whose decision regarding the eligibility of the assessee under the scheme is final even if the said decision may perverse since no appeal provision has been made. Therefore, the entire scheme has virtually been vested exclusively within his control and the party who seeks the benefit under the scheme has to wait for grant of mercy by the authority. For the foregoing discussion, the impugned order, dated 11.2.2014 passed by the first respondent is hereby set aside. The first respondent is directed to take up the appeal preferred by the petitioner and dispose of the same in accordance with law, after affording an opportunity ..... X X X X Extracts X X X X X X X X Extracts X X X X
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