M/S. Maharashtra Seamless Limited vs. The Additional Commissioner (Appeals-I)

Facts

The petitioner, M/s. Maharashtra Seamless Limited, challenged an Order-in-Appeal No. HYD-GST-RRC-APP1-413123-24 dated 07.12.2023 and a Rectification Order No. HYD-GST.RRC.APP1.265124-25.GST dated 19.08.2024, both passed by the Additional Commissioner (Appeals-I), Hyderabad. The petitioner contended that these orders were void, illegal, arbitrary, and violative of principles of natural justice and constitutional provisions. The core of the challenge stemmed from the appellate authority's decision to set aside a refund order solely on the ground that it was not a speaking order. The petitioner sought a writ of mandamus to declare the impugned orders void and illegal, and consequently, to set them aside.

Held

The Court held that the singular reason for interference by the appellate authority was that the order before it was a non-speaking order. Since a non-speaking order could not sustain scrutiny before the appellate authority, the Court deemed it proper to set aside both the appellate order and the original order which was appealed against and set aside by the appellate authority. The Court directed the original authority to re-hear and re-consider the matter and pass a fresh order in accordance with law. Crucially, the Court ordered that the refund already made in favour of the petitioner shall not be taken away until a fresh decision is taken by the competent authority. The Court explicitly stated that it was not expressing any opinion on the merits of the case.

Key Issues

1. Whether the appellate authority erred in setting aside the refund order on the sole ground that it was a non-speaking order, without remitting the matter back to the original authority for a speaking order? (Question of law) Petitioner's arguments: The petitioner argued that if the original refund order was found to be non-speaking, the appellate authority should have remitted the matter back to the original authority to pass a speaking order after hearing the parties. They contended that the appellate authority's action of setting aside the order was improper in this context. Revenue's arguments: The learned Standing Counsel for CBIC opposed the petitioner's contentions and supported the impugned order passed by the appellate authority.