JUDGMENT

(Judgment of the Court was delivered by T.S.Sivagnanam, J.)

These appeals have been filed by the appellant/assessee under Section

35G of the Central Excise Act, 1944 (hereinafter referred to as “the Act”) challenging the order dated 18.12.2009, passed by the Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench, Chennai (for brevity “the Tribunal”) in Final Order Nos.2 to 4 of 2010 respectively.

2.The appeals were admitted, on 18.03.2011, on the following substantial questions of law:-

“1.Whether in the facts and circumstances of the case, the Tribunal was correct in law in travelling beyond the Show Cause Notice and remanding the matter for fresh adjudication on a ground which was never raised by the Revenue in the Show Cause Notice or in the adjudication order?

2.Whether in the facts and circumstances of the case, the Tribunal was right in law in directing the adjudicating authority to examine the eligibility of credit in the light of Section 37(2) of the Central Excise Act when no such contention was raised by the Revenue in the Show Cause Notice?

3.Whether in the facts and circumstances of the case, the Tribunal was right in holding that the adjudicating authority should examine whether the impugned services can be considered as eligible input services under the Cenvat Credit Rules when the only issue in appeal was whether a debit note is a valid document or not for availing cenvat credit? And

4.Whether in the facts and circumstances of the case, the Tribunal was correct in holding even after accepting the submissions made by the Appellant with reference to the allegations in the Show Cause Notice that they can remand the matter for denovo adjudication with a fresh proposal which was not the subject matter of the appeal?”

3.We have elaborately heard Mr.S.Manoj, learned counsel appearing for the appellant/assessee and Mr.A.P.Srinivas, learned Senior Standing Counsel for the respondent/Revenue.

4.The short issue, which falls for consideration is whether the Tribunal had exceed its jurisdiction in making certain observations with regard to the validity of the CENVAT Credit Rules, 2004 (hereinafter referred to as “the CCR, 2004”) qua the provisions of Section 37 of the Act and proceeding to direct the original authority to issue a show cause notice to the appellant/assessee as regards its very entitlement for CENVAT credit.

5.The facts, which are necessary for the disposal of these appeals, are as below:-

5.1.The Assistant Commissioner of Central Excise, Salem-II Division, issued show cause notices dated 02.11.2006, 02.01.2007 and 05.04.2007 alleging wrong availment of service tax credit based on debit notes. The allegation in all the three show cause notices were identical except that the period during which such credit was availed is different. In the show cause notice dated 02.11.2006, it is stated that the appellant/assessee is engaged in the manufacture of caustic soda and chloromethane products falling under Chapters 28 and 29 of the Central Excise Tariff Act, 1985 and the appellant has contravened the provisions of Rule 9(1) of the CCR, 2004, inasmuch as they have wrongly availed service tax input credit based on ineligible documents, that is, debit notes issued by their service providers and utilized the said credit towards payment of duty and thereby rendering themselves liable for penal action under Rule 14 and Rule 15 of the CCR, 2004.

5.2.The show cause notice further states that under Rule 9(1) of the CCR, 2004, CENVAT/service tax credit can be taken by the manufacturer or provider of output service or input service distributor based on the following documents, viz., (i) an invoice; (ii) a supplementary invoice; (iii) a bill of entry; (iv) a certificate issued by an Appraiser of Customs in respect of goods imported through Foreign Post Office; (v) a challan; (vi) an invoice, bill or challan issued by an input service distributor under Rule 4A of the Service Tax Rules, 1994 (hereinafter referred to as