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DEWSOFT OVERSEAS (P) LTD. Versus COMMISSIONER OF SERVICE TAX, NEW DELHI

Recalling of an order passed by the tribunal in favor of assessee after the decision of Apex court refusing to grant stay - Classification of the services - jurisdiction of Court u/s 35L of the Act - suppression of facts - Held that: - Intentionally or unintentionally the fact remains that the Bench was not appraised of the said order of the Hon'ble Supreme Court As we have already observed that nondisclosure of the relevant facts and obtaining of a favourable order by not bringing the relevant .....

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And Mr. Narendra Singhvi, Adv Mr. KK Anand Advocate For Appellant Mr. Govind Dixit, DR For Respondent Per Ms. Archana Wadhwa : As per facts on record the dispute in the present appeal relating to classification of the services provided by the appellant was referred to the Larger Bench in the case of Great Lakes Institute of Management Ltd Vs. CST, Chennai [2013 (32) STR 305 (Fri.-LB)] and as per the Final Order passed in the said decision of the Larger Bench the same were held in favour of the R .....

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eir order dated 08 07 2016, granted leave to appeal in the matter. It is seen that the Hon'ble Supreme Court was also pleased to grant stay of recovery of penalty, subject to the appellants depositing the service tax along with interest within a period of two months. 3 Prior to the filing of appeal before the Hon'ble Supreme Court, the appellant had also moved an application for rectification of mistake before the Tribunal in terms of Section 35C(2) of the Central Excise Act, 1944 on the .....

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l filed before the Hon'ble apex court. 4. The said ROM application was listed on 02.08.2016 and was taken up for decision on the same day itself. After hearing both sides, Tribunal observed that admittedly the limitation issue was raised before it, but the same was not considered by the Bench and as such in view of various decisions laying down that non-consideration of limitation amounts to mistake on the part of the Tribunal requiring rectification, the Bench agreed to the appellant's .....

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order on ROM application. For the said purpose, they have filed a Miscellaneous Application praying for recalling of the said order passed on the appellant's ROM application. It stand argued by the Id. Departmental Representative that in as much as the final order dated 29 10.2015 passed by the Tribunal on merits was already appealed against by the appellant before the Hon'ble Supreme Court and was pending consideration for disposal, subject to the appellant's depositing the tax amou .....

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e appeal before the Hon'ble Supreme Court and as the Tribunal was kept in dark about this aspect by the Id. advocate as also by the Registry, the order dated 02 08 2016 stands obtained without full disclosure of facts and as such should be recalled He however, fairly admitted that the said fact was also not brought to the Bench either by the Departmental Representative or by the Chief Commissioner, who had admittedly received the same by that time. Revenue in their application have also subm .....

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sed on 29 10.2015 the Tribunal became functus officio and had no jurisdiction at all to entertain the application of ROM and the Tribunal could not have reviewed its earlier order and passed a new order setting aside its earlier order. Accordingly, he prayed for recalling the Final Order dated 20 08.2016, passed on ROM. 7 Contesting the above stand of the Revenue, Shri Lakshmi Kumaran, Id. advocate for the applicant raised a preliminary issue submitting that there is no provision for rectifying .....

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or rectification of some alleged mistake in an order rejecting an application for rectification of mistake. He also submits that Revenue itself has pleaded in the present Miscellaneous Application that the Tribunal having finally disposed of the appeal on 29 10 2015 has become functus officio and was not having any jurisdiction to entertain the ROM application. Ld. advocate submits that for the very same reason, the present application filed by Revenue cannot be entertained as the Tribunal has b .....

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Act. In fact, the Hon'ble Supreme Court, in exercise of jurisdiction under Section 35L of the Act has been pleased to grant leave vide its order dated 08.07.2016 against the Final Order dated 29.05.2015, passed by the Tribunal. There is no provision like Section 35F of the Act requiring an appellant to deposit the amount confirmed against him, as a condition of hearing of his appeal. An appellant is not required to deposit the amount before his appeal is to be admitted before the Hon'bl .....

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bunal stands merged with the Hon'ble Supreme Court order dated 08.07.2016 is not worthy of acceptance. Ld. advocate further contended that the allegation of forum shopping' made against the appellant is not sustainable in as much as filing of an appeal before the Hon'ble Supreme Court as well as filing of ROM application before the Tribunal, in exercising of the statutory rights given to the assessee in terms of two different section of Central Excise Act cannot be held as forum shop .....

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urt will not have any effect on the disposal of ROM, as the fact of pendency of ROM was in the knowledge of Supreme Court. Though he fairly agreed that the said fact was not mentioned before the Tribunal at the time of disposal of ROM but submits that the same was an unintentional inadvertent, mistake on the part of the advocate. He has filed an affidavit to the effect that the order was brought by him. or mentioning on the date of hearing of ROM but could not be placed before the Bench He furth .....

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ion that Department has leaked the information to the press, in respect of a matter, which is subjudice, with a mala fide intention to create pressure on the Bench of the Tribunal. 8. We have considered the submissions made by both sides. Revenue has sought for recalling of the order passed on 02.08.2016 vide which the applicant's ROM applications stands allowed on the point of limitation. It is not the Revenue's case that the said order is wrong or against the law. Their only contention .....

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e Supreme Court and should have brought the same to the notice of the Bench Any order obtained by fraud is a nullity. 9. Without commenting upon the correctness of the Order passed in ROM, we are of the view that the Id. advocate was under legal duty to bring to the notice of the Bench, at the time of disposal of ROM application, the above factual developments irrespective of the fact as to whether the Tribunal in that case would have decided or not decided the ROM application. Though we agree w .....

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he court seeking justice must come with clean hands The fraud vitiates everything and the fact of non-disclosure of the order of the Hon'ble Supreme Court has the effect of making the ROM order dated 02.08.2016 void ab initio. Though the Id advocate, at the time of hearing on 03.10.2016 for the purpose of disposal of the Miscellaneous Application filed by Revenue, has agreed that the said order should have been brought to the notice of the Bench and he had, in fact, brought the said order fo .....

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tion on the part of the Id. advocate for not bringing the said fact to the notice of the Bench. At this stage, we may take note of the Hon'ble Supreme Court decision in the case of Meghmala & Ors vs. G Narasimha Reddy & Ors. [(2010) 8 SCC 3831 wherein the concept of fraud was considered by the Hon'ble Supreme Court It was observed that it is settled proposition of law that where the order is obtained by making misrepresentation or playing fraud upon the competent authority, such .....

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to what constitute a fraud, the Hon'ble Supreme Court observed that fraud and deception are synonymous. Suppression of material document has been held to be as amounting to a fraud on the Court. By applying the ratio of the above decision, it has to be held that the material fact of pendency of appeal before the Hon'ble Supreme Court and the directions of the Hon ble Supreme Court to deposit tax amount along with interest was suppressed from the Court the same would constitute fraud and .....

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er passed on ROM application as prayed for by Revenue and allow the Miscellaneous Application filed by them. 11. Before we part, we deal with technical objections raised by the Id advocate as regards filing of second application for rectification of mistake in the order passed on the ROM. We make it clear that Revenue is not finding any mistake in the order dated 02.08.2016 passed by the Tribunal on the applicant's ROM application in as much as it is not their contention that the order is wr .....

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