Comnr,Central Excise vs. Rkg Coal Transport

Held

The Court held that in view of the Circular dated July 11, 2018, issued by the Central Board of Indirect Taxes & Customs, which sets the monetary limit for filing appeals before the High Court at Rs. 50,00,000/-, and considering that the tax effect in the present appeal was less than Rs. 50 lakh, the appeal stood disposed of. The Court granted liberty to the appellant to revive the appeal within thirty days from the date of the order in case of any difficulty. The reasoning is based on the binding nature of the CBIC Circular on the Department for reducing litigation, especially for cases falling below the prescribed monetary thresholds. The ratio decidendi is that appeals filed by the Department before the High Court, involving legacy issues of Central Excise and Service Tax, are to be governed by the monetary limits specified in the CBIC Circular dated July 11, 2018, and such appeals with a tax effect below the stipulated limit are to be disposed of accordingly.

Facts

The appeal was filed by the Department against an order dated January 16, 2008, passed by the CESTAT, Kolkata. The tax effect in dispute was stated to be less than Rs. 50 lakh. A Circular dated July 11, 2018, issued by the Central Board of Indirect Taxes & Customs (CBIC) under Section 35R of the Central Excise Act, 1944, revised the monetary limits for filing appeals. For High Courts, the revised monetary limit below which appeals shall not be filed was set at Rs. 50,00,000/-. This instruction was applicable to legacy issues relating to Central Excise and Service Tax, including pending cases.

Key Issues

1. Whether the appeal filed by the Department is maintainable before the High Court given the revised monetary limits stipulated in the CBIC Circular dated July 11, 2018, particularly in light of the tax effect being less than Rs. 50 lakh? (Question of law, turning on Section 35R of the Central Excise Act, 1944, as made applicable to Service Tax by Section 83 of the Finance Act, 1994, and the CBIC Circular dated July 11, 2018). Contentions of the Petitioner/Appellant: The Department argued that the appeal was filed against an order of the CESTAT. The tax effect was less than Rs. 50 lakh, which falls within the revised monetary limit for filing appeals before the High Court as per the CBIC Circular dated July 11, 2018. Contentions of the Revenue/State: The judgment does not record any specific arguments made by the Revenue/State. However, the Department is the appellant, and the order under challenge was passed by the CESTAT, implying the Revenue/State would be the respondent.