ABHILASH .

G
BA0130001

ADJUDICATION, PENALTIES AND APPEALS IN INDIRECT TAXES

In this project the researcher would concentrate on the three major indirect taxes, viz.
Central Excise, Service Tax and Customs are being administered by single authority i.e.
Central Board of Excise and Customs (CBE&C) under Ministry of Finance, Government of
India. Final departmental appellate authority i.e. Tribunal. It is, therefore, natural that basic
thinking and approach is same in all the legislations connected with these three taxes. Many
provisions of Central Excise are made applicable to service tax. Many provisions of customs
law have been made applicable to Central Excise.

Adjudicate means to hear or try and decide judicially and adjudication means giving a
decision. As per Oxford Dictionary, adjudicate means deciding judicially, pronounce.
Excise and Customs Authorities are empowered to determine classification, valuation, refund
claims and the tax/duty payable. They are also empowered to grant various permissions under
rules and impose fines, penalties, etc., and confiscate offending goods. Since the authorities
are departmental officers, the process is called departmental adjudication. They are
required to follow principles of natural justice. Their adjudicating powers are prescribed
under Act and departmental circulars their orders are appealable. These are quasi judicial
authorities and they are not bound by any trade notice or instructions of superiors.
Uncontrolled authority may cause great damage to an assessee and hence opportunity of
appeal against the order has been provided.