By TIOL News Service

NEW DELHI, APR 24, 2014: THE Central Excise appellate mechanism was/is a very complicated maze which is beyond the comprehension of high profile lawyers, wise judges of the High Courts, even wiser judges of the Supreme Court and the wisest of them all - the all knowing Inspector of Central Excise whose erudition gets the stamp of approval of all the wise officers of the Department. But of course the assessee is expected to be a master on the subject.

We are not sure where to go in appeal against an interim order of the Commissioner(A) or for that matter whether we can go in appeal at all. In many cases we are not sure whether the appeal is before the High Court or Supreme Court. From the same order of the CESTAT, one party went to his High Court and got the CESTAT order quashed while another party went to his High Court and his High Court dismissed the appeal on the ground that it had no jurisdiction - the appeal had to be filed in the Supreme Court.

There is also a little known appellate channel - the Government as Revision Authority.

Under Section 35EE of the Central Excise Act, in respect of orders passed by Commissioner(A) relating to transit loss, rebate or export without payment of duty, the appeal lies to the Central Government - the Revision Authority.

So in case of a dispute on rebate under Central Excise, against an order of the COMMISSIONER( A), the appeal is with the Revision Authority.

What about Service Tax?

As per Section 83 of the Finance Act, 1994, certain sections of the Central Excise Act are made applicable so far as may be, in relation to service tax as they apply in relation to a duty excise.

Section 35EE is one such section made applicable to Service Tax. But this has been made applicable only with effect from 28.05.2012 by Finance Act 2012.

As per Section 86 of the Finance Act 1994, an appeal can be made to the CESTAT against an order passed by the Commissioner(A).

Is there a conflict between Section 83 and Section 86? Which one would prevail? In Service Tax rebate matters where should one go in appeal - to the Tribunal or the Revision Authority?

Under Central Excise, Section 35B bars an appeal to the Tribunal ion respect of transit loss, rebate or export without payment of duty; but there is no such bar under Service Tax.

The Delhi High Court recently solved this problem.

In an appeal before it, the Tribunal had held that a specific reference of Section 35EE (of the Central Excise Act) precluded an appeal under Section 86, and that the remedy available to the assessee was a revision to the Central Government.

The High Court held: it is held that the amendment to Section 83 by making a specific reference to Section 35EE of the Central Excise Act, did not make any difference to the nature of jurisdiction exercisable by the CESTAT under Section 86; it continued to possess jurisdiction to decide on matters pertaining to rebate and refund. For this reason, the question of law is answered in favour of the assessee/appellant and against the revenue.

(See 2014-TIOL-560-HC-DEL-ST)