Prin.Commissioner CGST And Central Excise Lko. vs. M/S Anand Motors Agencies LTD. Lko. U.P.

Held

The Court held that the CESTAT erred in setting aside the demand by relying on its Final Order No. 70112/2015 dated 17.12.2015, which had not attained finality. The High Court had previously remanded the matter to the Tribunal for fresh consideration, and this appeal was still pending. The CESTAT's reasoning that the adjudicating authorities had ignored judicial discipline by not following a binding order was flawed, as the Tribunal itself was required to follow judicial discipline by deciding the pending appeal afresh. The Court found that the CESTAT ought to have decided both appeals, which involved common issues, together. Therefore, the impugned judgment and order of the CESTAT dated 04.02.2022 was not sustainable. The Court allowed the appeal and set aside the CESTAT's order to the extent of passing the order in the said appeal, directing the Tribunal to decide Service Tax Appeal No. 70567 of 2019 afresh after clubbing it with the earlier appeal pending after remand, within two months.

Facts

The appellant, Principal Commissioner, CGST and Central Excise, Lucknow, challenged an order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Allahabad. The respondent, M/s Anand Motors Agencies Ltd., was issued a show cause notice dated 20.11.2017 for service tax liability for the periods 2012-13 to 2016-17, invoking the extended period of limitation. The demand confirmed by the adjudicating authority was Rs. 6,64,07,784/-. The respondent had earned taxable income from car insurance policies, finance arrangements, and reimbursement of expenses from Maruti Suzuki India Limited for providing business auxiliary services. The CESTAT had allowed the respondent's appeal. The appellant argued that a previous CESTAT order (Final Order No. 70112/2015 dated 17.12.2015) on similar issues for the period 2002-03 to 2006-07 had not attained finality as it was remanded by the High Court for fresh decision.

Key Issues

1. Whether the CESTAT erred in overlooking that its Final Order No. 70112/2015 dated 17.12.2015, concerning similar issues, had not attained finality because it was appealed against by the Revenue and remanded by the High Court for fresh decision, and is still pending before the Tribunal? Contentions: Petitioner (Appellant): The CESTAT erred by relying on its previous order dated 17.12.2015, which had not attained finality due to the High Court's remand order dated 13.04.2017. The Tribunal should have decided the pending appeal afresh instead of setting aside the demand based on an order that was subject to further adjudication. The Tribunal also failed to decide the current appeal along with the earlier remanded appeal, which involved common issues. Respondent: The respondent opposed the appellant's submissions but did not dispute that the order dated 17.12.2015 had not attained finality and was pending before the Tribunal after remand.