M/s. Vippy Industries Ltd. vs C.C.E., Indore

The appeal is preferred against the Order-in-Appeal dated 24.11.2010 passed by Shri G.R. Meena, Commissioner (Appeals), Indore. Revenue's

appeal filed by the Asst. Commissioner of Customs and Central Excise, Ujjain was allowed by the impugned order to the extent of disallowing refund

of service tax incurred by the appellant/assessee on input services used for export of goods. Refund was claimed under Notification No.41/2007-ST,

dated 06.10.2007. Refund was granted vide order dated 23.02.2010.

The appellant claimed refund of service tax to the extent of Rs.3,68,786/-. The primary adjudicating authority vide order dated 23.02.2010

sanctioned refund to the extent of Rs.3,52,556/- after disallowing refund in respect of certain input services, details of which are not material for the

disposal of this appeal.

Exercising powers under Section 84(1) of the Finance Act, 1994, C.C.E., Indore passed Review Order No.238, dated 27.04.2010 and directed the

primary adjudicating authority, the Asst. Commissioner of Customs and Central Excise, Ujjain to prefer an appeal against his order dated 23.02.2010.

Para-4 of the Review Order clearly records that on an examination of the Order-in-Original, the reviewing Commissioner (Mr. G.R. Meena) finds that

the same is neither legal nor proper. Grounds for the conclusion were specified thereunder. Detailed reasons were recorded by Mr. G.R. Meena for

his conclusion that the Order-in-Original dated 23.03.2010 was unsustainable to the extent refund was granted on terminal handling charges, by the

primary authority.

It is primarily alleged in the present appeal and the factual basis of this allegation is conceded by Respondent/ Revenue and is also apparent from

the Order-in-Appeal, that the impugned order was passed by the same officer who passed the Review Order dated 27.04.2010.

Exercise of appellate jurisdiction by the same officer who passed the review order and had recorded therein a clear conclusion that the primary

order was unsustainable is a clear travesty of established principles of natural justice, of that great principles that none should be judge in his own

cause nor, one who has pre-judged on issue should sit in judgement as an appellate authority. The impugned order is in exercise of an appellate power,

which requires an independent, unprejudiced exercise of mind, which is not available in the facts and circumstances of the case.

For the aforesaid reasons, we allow the appeal and quash the Order-in-Appeal. The appropriate appellate Commissioner may however hear and

dispose of the appeal afresh, pursuant to the Review Order dated 27.04.2010, in accordance with law. Since we dispose of this appeal on the point of

incompetence of the person who had passed the impugned order, we decline to go into the other questions raised in the appeal regarding merits of the

appellant's claim for refund. No costs.