Arindam Sinha, J. - The assessee has preferred these two appeals against order dated 3rd February, 2016 passed by the Customs Excise and Service Tax Appellate Tribunal(CESTAT), Eastern Zonal Bench, Kolkata. We had, upon hearing the parties, admitted the appeals on 6th March, 2017 framing the following substantial questions of law as involved in this case.

(i) Whether the Tribunal, while remanding the matter, addressed any of the issues or questions which were not included in the show cause notice

(ii) Whether the remand order of the Tribunal is otherwise bad in law

2. The facts in brief are that the Commissioner, Service Tax had issued show cause notice (SCN) dated 16th October, 2010 alleging the appellant did not levy or pay Service Tax of Rs. 4237.49 lakhs and education cess of Rs. 51.45 lakhs, leviable on taxable services namely banking and other financial services and business auxiliary services, during the periods respectively from 1st April, 2002 to 31st March, 2007 and 1st July, 2003 to 31st March, 2007. The longer period of limitation as provided under the proviso to Section 73(1) of the Finance Act, 1994 was invoked for recovery of the aforesaid amounts of Service Tax and education cess.

3. By letter dated 14th January, 2008 the assessee showed cause. The matter proceeded for adjudication and order-in-original dated 31st March, 2009 came to be passed. Both the assessee and the Revenue preferred appeals against the said order-in-original. The appellant/assessee, in these appeals, has assailed findings in the order of the Tribunal relating to the aforesaid demand resulting in directions for remand.

4. Mr. J.K. Mittal, learned Advocate appeared on behalf of the appellant/assessee. Referring to the SCN he submitted that the demand, for the respective periods, was on two counts namely banking and other financial services falling under Section 65(105)(zm) and business auxiliary services falling under Section 65(105)(zzb), both under the said Act.

5. The assessee, he submitted, showed cause by letter dated 14th January, 2008 in which the following was relied upon as set out below :

"That they discontinued the financing business modes of "Leasing" and "Hire Purchase", which together with service tax impact, would be costlier and make for them difficult to survive in the competitive market. This was a conscious business decision looking at the commercial viability, and not an attempt to evade service tax."

6. Referring to the order in original dated 31st March, 2009 Mr. Mittal pointed out, the adjudicating authority had held that operating lease was nothing but renting of tangible goods including machinery, equipment and appliance, for use without transferring right of possession and effective control classifiable under supply of tangible goods service which became taxable with effect from 16th May, 2008. He relied upon the view, expressed by the said authority, that when a new taxable service has been introduced, it cannot be said that the said service was classifiable under different category prior to the date of effect of the new taxable service. He went on to submit, the adjudicating authority has also held that loan against hypothecation is a simple business of providing loan to the borrower and the asset is owned by the borrower from the beginning. Loan against hypothecation cannot be termed as financial leasing as defined under Section 65(12) of the said Act so no Service Tax is payable on such activities. He further relied on the opinion expressed in the said order regarding hire purchase finance not being taxable under the category of banking and other financial service. He went on to submit, a sum of Rs. 4283.17 lakhs on account of gain on securitization was also sought to be taxed. In this regard he submitted that firstly gain on securitization was not mentioned in the SCN and as such it could not form part of the adjudication at any stage. For this submission he relied on the following decisions of the Supreme Court.

(i) Precision Rubber Industries Pvt. Ltd. v. Commissioner of Central Excise, Mumbai reported in 2016 (334) E.L.T. 577 (S.C.), paragraph 11;

(ii) Commissioner of Central Excise, Bhubaneshwar-I v. Champdany Industries Ltd. reported in (2009) 9 SCC 466 [LQ/SC/2009/1809] , paragraph 38 : 2009 (241) E.L.T. 481 (S.C.); and

(iii) Commissioner of Customs, Mumbai v. Toyo Engineering India Ltd. reported in (2006) 7 SCC 592 [LQ/SC/2006/785] , paragraph 16 : 2006 (201) E.L.T. 513 (S.C.).

7. Mr. Mittal submitted that without prejudice to his submission on the scope of adjudication as arisen from the SCN, in any event the adjudicating authority had expressed the view that gain on securitization being a profit/gain on sale of financial assets, e.g. loan receivables and not an amount charged towards rendering any financial service, the question of charging Service Tax on the same does not arise at all. The Revenue had not challenged the said finding before the Tribunal. As such the order of the adjudicating authority on this issue was correct and there was no occasion for the direction of remand given in relation thereto in the impugned order. In directing remand, according to Mr. Mittal, the Tribunal had gone beyond the lis and provided an opportunity to the Revenue to cure defects in the SCN which is not permissible under the law. He relied on a decision of the High Court of Bombay in the case of Commissioner of Central Excise v. Syntel International (P) Ltd. reported in 2015 (39) S.T.R. 27 [LQ/BomHC/2015/97] (Bom.), in particular to paragraph 8 therein, on the view expressed as is reproduced below :

"Though the appellate power by implication includes a power to remand the case back to the Adjudicating Authority, still such power should not be exercised routinely and as a matter of course. A remand should be rare and should not furnish an opportunity to parties to get over or remove the defects and lacunas in their cases. Equally it should not furnish any reason for the Original/Adjudicating Authority to take up matters all over again and for fresh consideration. We do not see any specific issue necessitating a remand. Merely observing that the issues considered by the Tribunal in paragraph 5.1 and 5.2 have not been examined at all by the Adjudicating Authority would mean a blanket and complete remand of the original case. All this, in revenue matters ought to be avoided. It is in the interest of the public that matters concerning public revenue attain finality and expeditiously."

8. Mr. Mittal then submitted that the adjudicating authority had looked into the allegations made in the SCN regarding the part of the demand based on taxable services falling under the head business auxiliary service. According to him the Tribunal was wrong in saying that the adjudicating authority while rejecting the RBI figures, relied upon by the Revenue in making the demand, and re-calculating the same reducing the demand to Rs. 57,79,441/- and Rs. 39,984/- respectively on account of Service Tax and education cess, did not give reasons in as much as reasons were provided in the portion of the order-in-original as is reproduced below :

"In para 3.13 of the impugned notice it is stated that in RBI Returns there was another income head i.e. "other fee based income-collection commission" which too the said director (Sri Sanjay Chamria, VC and MD) failed to explain. He was also asked to explain/confirm whether any commission received from banks/other institutions etc., which he could not confirm. In the calculation sheet collection of commission amounts for 2003-04 has been taken from the income statement submitted by the said assessee. But for subsequent years the income figures have been taken from RBI statement. RBI statement figures have not been analysed and no explanation is available to show that RBI statement figures show only the commission income. In this respect the said assessee have submitted that the figures being picked up from the RBI Returns has also included amount of M and C Agent Fee-Securitisation A/c., in the nature of differential interest between FD Rate and applicable Discount Rate. This being in the nature of pure interest, cannot in any case be charged to Service Tax. The said assessee have provided the following figures as "Collection Commission" for the years 2003-04 to 2005-06 and stated that in the year 2006-07 there is no income under the head "Collection Commission". I am of considered opinion that there is no justification in calculating Service Tax liability on the basis of figures of RBI Returns as these are not true reflection of income under "Collection Commission".

There was no challenge against such findings of the adjudicating authority put up by the Revenue before the Tribunal. The Revenue was unable to produce any material before the Tribunal to show that the reasons given by the adjudicating authority were on erroneous appreciation of facts. Direction for remand on this issue is also unjustified.

9. His next submission was directed to the part of the demand in the SCN based on the allegation that a sum of Rs. 93 lakhs had been collected by the appellant as Service Tax but not paid to the credit of Central Government. According to him only an amount of Rs. 7,54,689/- was collected by the appellant representing Service Tax and the balance consisted of a contingency deposit of Rs. 37,78,823/-, erroneously taken twice and computation error. He submitted, on instructions, this part of the demand was also remanded for fresh adjudication but his client would not press for such fresh adjudication. However, what his client is aggrieved by is that the Tribunal did not adjudicate the grievance of the appellant regarding the finding of suppression and penalty imposed by the adjudicating authority. He submitted, there was no suppression by his client. If at all, it was to the extent of the sum of Rs. 7,54,689/-. In any event the penalty imposed was far in excess of the said amount and imposed without adjudication. He relied on Section 83A of the said Act which is reproduced below :

"83A. Power of adjudication. - Where under this Chapter or the rules made thereunder any person is liable to a penalty, such penalty may be adjudged by the Central Excise Officer conferred with such power as the Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963(54 of 1963), may, by notification in the Official Gazette, specify."

He submitted, the provision in Section 83A mandated an adjudication which would necessarily come after there is a finding that a person is liable to a penalty. Such must be a separate proceeding since there is provision for appeal against the order of assessment. When an order of assessment is under scrutiny, unless the order of assessment reaches its finality, the question of initiation of penalty proceedings does not and cannot arise. For this he relied on an order of the High Court of Judicature for Andhra Pradesh in the case of Spandana Spoorthy Financial Ltd. v. C.C., C. Ex and S.T. Hyderabad-IV reported in 2014 (35) S.T.R. 183 (A.P.), to the portion in paragraph 2 therein as is reproduced below :

"2. According to us, when the appeal is admitted for hearing and the order of the assessment is under scrutiny, unless the order of assessment reaches its finality, the question of initiation of penalty proceedings does not and cannot arise............."

He submitted further, the SCN was issued under Section 73 and penalty imposed under Section 78 of the said Act. Both the sections stand substituted. Section 73 was substituted with effect from 10th September, 2004 which date fell within the respective periods for which the demand was made. Section 78 stood substituted with effect from 14th May, 2015. According to him the adjudicating authority failed to appreciate that part of the demand was in respect of a period in which the provisions in Section 73, before substitution, applied and in imposing penalty had done so under the provisions of substituted Section 78.

10. He went on to submit, as per the Central Excise Intelligence and Investigation Manual the SCN is more than a notice. He relied on the particulars given in Paragraph 2 of Chapter 9 of the said Manual, to the clauses therein as are reproduced below :

"2 ........

i. The Show Cause Notice should be issued only after proper inquiry/investigation i.e. when the facts used are ascertained and allegations are justified.

ii. .......

iii. The Show Cause Notice should not be an exercise in deliberate ambiguity. It should be specific and unambiguous.

iv. .........

v. The charges should be specific. They should not be vague/or contradictory.

vi. ..........

vii. The duty amount needs to be quantified and explained in a chart as to how the same was arrived at. The duty demanded should be manifestly specified in the notice itself.

viii. ...........

ix. ..........

x. ..........

xi. ..........

xii. ............."

It would appear from the SCN that the allegations made were on disclosures by his client as required by the department upon having conducted inquiry and investigation. No part of the information furnished by his client could be demonstrated to be incorrect. The question of suppression cannot arise and accordingly the SCN carries only a bald allegation in regard thereto. On top of that by the impugned order the Tribunal purported to find that the adjudicating authority did not cause proper inquiry nor investigation, to cite that as reason for the directions of remand.

11. Mr. Banerjee led by Mr. Roy, learned Advocates appeared on behalf of the Revenue. They relied on the impugned order to submit that the directions for remand given therein were duly made and the questions framed were not involved in the case. The Tribunal had considered several authorities in making the directions it did for remand as the true nature of transactions entered into by the appellant could only be found out upon going through all the documents in relation thereto which had not been done by the adjudicating authority. The SCN had put the appellant on notice of the aggregate demand, part of which was on account of gain on securitization and as such there was no error committed by the Tribunal in considering the issue and directing remand.

12. We had granted two adjournments of hearing particularly for the purpose of the Revenue to demonstrate whether the SCN notified the claim on account of gain on securitization but the Revenue could not dispute that the same had not been mentioned therein. What does appear from the order-in-original as well as the impugned order is that the parties were heard on the issue but the appellant took the point only before the Tribunal. So also regarding the point of limitation. As such since the appellant had sought to meet this issue and others on merits, we are not inclined to go into this objection or the point of limitation, as not relevant to the context of answering the questions framed.

13. The Commissioner, Service Tax in making the order-in-original accepted, inter alia, the contention of the assessee that in the period under consideration the assessee had indulged in providing to its customers, operating lease of equipment. This was done by the equipment being let out subject to payment of rentals, there being no transfer of ownership of the assessee at the end of the lease term. Risks and rewards incident to ownership were thereby not substantially transferred. Possession of the assets were to be handed back to the assessee after termination of the agreement. The Commissioner held that this operating lease was different from financial lease as defined under Section 65(12) of the Finance Act, 1994. The Commissioner observed that a new taxable service had been introduced with effect from 16th March, 2008 as supply of tangible goods service defined under Section 65(105)(zzzzj) of the said Act. The Commissioner held that operating lease is nothing but renting of tangible goods including machinery equipment and appliances for use, without transferring right of possession and effective control. The Commissioner, therefore, was of the considered opinion that operating lease cannot be termed as financial lease or be classified under the category of banking and other financial services and dropped the demand of Service Tax on the rentals received by the assessee.

14. The Commissioner then, in the said order, proceeded to consider whether loan against hypothecation is a service as asserted by the Revenue and disputed by the assessee. The Commissioner found that loan against hypothecation is a simple business of providing loan to the borrower and the asset is owned by the borrower from the beginning. Loan against hypothecation cannot be termed as financial leasing as defined under Section 65(12) of the said Act. So no Service Tax is payable on such activities. The Commissioner went on to opine that Service Tax is not leviable on hire purchase finance because of the distinction between hire purchase and hire purchase finance, the latter not taxable under the category of banking and other financial services. On the basis of such reasoning the Commissioner said as follows :-

"In the above discussion it has been clearly explained that financial leasing, equipment leasing and hire purchase are taxable services under the category of "Banking and Other Financial Service" and taxable effective from 16-7-2001. It has also been explained that operating lease, loan against hypothecation and hire purchase finance are not taxable services under the category of "Banking and Other Financial Service". In the impugned notice consolidated demand has been made without showing any breakup of value of taxable service under the above noted categories. Now it is required to re-calculate the demand on the basis of available records. The said assessee have submitted a statement of Accounts for the years 2002-03 to 2006-07 and also Balance sheets for the same accounting years. I have examined the calculation provided in the impugned notice vis-a-vis statement of Accounts for the period 2002-03 to 2006-07."

The Commissioner proceeded to re-calculate the total demand as stated in the said order. By the said order demand of Service Tax in the SCN amounting to Rs. 37,74,26,080/- and education cess amounting to Rs. 50,18,787/- was dropped and the respective balance amounts demanded along with penalty as imposed.

15. On perusal of the grounds of appeal taken by the Revenue in the Tribunal, we find the grievance was that the adjudicating authority had only relied upon the figures furnished and clarifications given by the assessee without probing the basis of such figures or veracity of clarifications given by the assessee. That the assessees contention of operating lease was accepted even where the basic condition, that is the user would be liable for maintenance of the equipment and the payment of taxes and insurance etc., is present. As such the adjudicating authority while observing that operating lease, loan against hypothecation and hire purchase finance are not taxable under the category of banking and other financial services, had not examined whether these services were actually financial leasing and hire purchase under the garb of different name and style.

16. It appears, the Tribunal accepted the contentions of the Revenue in making its directions for remand except on the issue of Rs. 93 lakhs, being a part of the aggregate demand, on which the direction was made in fairness since the other issues involved regarding the rest of the demand stood remanded.

17. For the purpose of answering the questions formulated it is necessary to ascertain the law regarding powers of the Appellate Tribunal under the said Act. Sub-section (7) in Section 86 of the Finance Act, 1994 provides as follows :

"86..........

(7). Subject to the provisions of this Chapter, in hearing the appeals and making orders under this section, the Appellate Tribunal shall exercise the same powers and follow the same procedure as it exercises and follows in hearing the appeals and making orders under the Central Excise Act, 1944 (1 of 1944)."

It is sufficient, for the aforesaid purpose, to only reproduce sub-section (1) in Section 35C of the Central Excise Act, 1944 :

"35C. Orders of Appellate Tribunal. - (1) The Appellate Tribunal may, after giving the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit, confirming, modifying or annulling the decision or order appealed against or may refer the case back to the authority which passed such decision or order with such directions as the Appellate Tribunal may think fit, for a fresh adjudication or decision, as the case may be, after taking additional evidence, if necessary."

The provisions of law extracted above empower the Appellate Tribunal to refer the case back to the authority which passed such decision or order, with such directions as the Appellate Tribunal may think fit, for a fresh adjudication or decision, as the case may be, after taking additional evidence, if necessary. The Tribunal remanded all the issues to the adjudicating authority for fresh adjudication.

18. In the impugned order sample agreements were examined. Relying upon a decision of the Supreme Court in the case of Sundaram Finance Ltd. v. State of Kerala reported in AIR 1966 SC 1178 [LQ/SC/1965/351] , the Tribunal said as follows :

"18. Needless to emphasize, in considering the applicability of the ratio of the aforesaid judgment, and also the Boards Circular to the facts of the present case, it is necessary to understand the true nature of the agreements/contracts entered into between the appellant and their customers. We do not receive any assistance from the impugned order as the ld. Adjudicating authority has not referred to any of the agreements/contracts between the appellant and its customers, but only on the basis of interpretation/analysis of the provisions and circulars arrived at the conclusion on the taxability/non-taxability of various services rendered by the appellant. During the course of argument before this Tribunal, the appellant had referred to sample copies of agreements relating to lease agreements entered prior to and after 16-7-2001, hire purchase agreement before and after 16-7-2001, hire purchase finance agreements, loan-cum hypothecation agreements. .........

26. As already noted above even though the ld. Commissioner has recorded finding on the aspect of demand of Service Tax on the services of financial leasing, equipment leasing and hire purchase as taxable service while dropping the demand on operating lease, loan against hypothecation and hire purchase finance, but failed to discuss any of the agreements/documents to ascertain the true colour of the transaction between the appellant and its customers. Also, we find that even though the demand is spread over a period of five years i.e. from April, 2002 to March, 2007, however, agreements for all these years had not been enclosed. In absence of complete facts supported by documents indicating the nature of true transaction between the appellant and its customers, it would certainly be difficult to arrive at a conclusion, whether the claim of the appellant that their transactions involve financial leasing, equipment leasing and hire purchase, where the commissioner confirmed the demand and others are operating lease, loan against hypothecation and hire purchase finance, where the demands were dropped. The Honble Supreme Court in Sundaram Finances case has categorically laid down that the nature of transaction culled out from the documents and surrounding circumstances are the decisive factors in arriving at a conclusion whether the ownership of the goods under hire purchase agreement has been retained or conveyed on completion of transaction. Therefore, all these agreements need to be scrutinized along with supported evidences/documents which could not be possible at this appellate stage as all the transaction documents are not enclosed with the agreement; besides these agreements were not examined/scrutinized by the original adjudicating authority even though equipped with enough manpower to undertake such a herculean task. In the result, we are of the firm opinion that ascertaining of the facts are vital to application of the principle of law, in the interest of justice this aspect need to be remitted to the ld. Commissioner for verification of the facts in detail and ascertain the true nature of transaction between the appellant and its customers during the period under dispute and arrive at the conclusion whether the transaction/services falls within the scope of taxable services of banking and other financial services defined at Section 65(12) of Finance Act, 1994...........

41. Since most of the issues raised by the assessee and the revenue are remanded for reconsideration, hence, in our considered view, it would be inappropriate to record any observation on the applicability of extended period and penal provisions at this stage when the facts are not clear. The adjudicating authority would be free to decide after analysis of facts/evidences on record and that would be produced in the remand proceeding to arrive at a conclusion on the aspect of limitation and imposition of penalty accordingly."

19. The Tribunal went on to give the following directions.

"(I) The terms of the contract relating to all the agreements claimed to be financial lease, equipment lease, operating lease, hire purchase agreement, hire purchase finance agreements and loan cum hypothecation agreements be analysed/examined along with other relevant documents/evidences to ascertain the true nature of transaction between the appellant and its customers so as to arrive at a conclusion whether the said services fall within the scope of "Banking and other Financial services".

(II) The securitization agreements/contracts between the appellant and its customer banks be examined/scrutinized to ascertain whether the transaction is that of a sale or a service, accordingly, its deductibility from the gross taxable value or otherwise.

(III) In the event various services rendered are held to be taxable, detail findings and reasons in computing the value either from RBI statements or from any other source for the years 2004-05, 2005-06 and 2006-07 be recorded.

(VI) The transactions between the Appellant and clients (banks) be scrutinized to ascertain the collection commission received by the Appellant whether would fall under the scope of Business Auxiliary Service (BAS).

(V) The Appellant be allowed to furnish further evidences in support of their claim that demand of Rs. 93.00 lakh is the result of computation error, the amount of Rs. 69,52,945/- is collected as contingency deposit and not Service Tax.

(VI) The demand on penal interest and termination charges are liable to be dropped and the transaction relating to collection of Management Fees be scrutinized and reasons be recorded for its leviability or otherwise to service tax under the category of "Banking and other Financial Services."

20. Thus by the impugned order there was remand of the issues for reconsideration on the aforesaid directions which amount to taking of additional evidence. The Tribunal being an appellate forum exercised its power to remand as well as give directions for taking additional evidence. Power of remand and directions for taking additional evidence by an Appellate Court is provided for in Order 41 Rules 23, 23A and 27 to 29 of the Code of Civil Procedure, 1908. The Code separately provides for remand and production of additional evidence in Appellate Court which is not so under Section 35C of the Central Excise Act, 1944. The power of remand prescribed by the Code is that where the Court, from whose decree an appeal is preferred, disposed of the suit upon a preliminary point or the case was disposed of otherwise than on a preliminary point, the decree is reversed in appeal and a retrial is or considered necessary, the Appellate Court will exercise the power of remand in both such instances. However, this power of remand requires the Court from whose decree appeal was preferred, to determine the suit; and the evidence (if any) recorded during the original trial shall, subject to all just exceptions, be evidence during the trial after remand. The Code in providing for production of additional evidence prescribes the procedure for the production of it in the Appellate Court itself, either by the said Court taking the evidence or having it taken upon directions made by it. The Tribunal in exercising appellate power gave directions for remand without setting aside the order-in-original, either on a preliminary point or otherwise on merits. In directing taking of additional evidence, it did not consider any material disclosed before it being necessary to be produced as additional evidence before the adjudicating authority. The Tribunal simply directed the adjudicating authority to take additional evidence on remand.

21. The Supreme Court in the case of Land Acquisition Officer, City Improvement Trust Board, Bangalore v. H. Narayanaiah, etc. reported in AIR 1976 SC 2403 [LQ/SC/1976/269] , in paragraph 28 of that judgment declared the law in regard to taking of additional evidence as follows :

"28. The Karnataka High Court had, however, not complied with provisions of Order 41, Rule 27 of the C.P.C. which require that an appellate Court should be satisfied that the additional evidence is required to enable them either to pronounce judgment or for any other substantial cause. It has recorded no reasons to show that it had considered the requirements of Rule 27, Order 41, of the C.P.C. We are of opinion that the High Court should have recorded its reasons to show why it found the admission of such evidence to be necessary for some substantial reason...."

22. We are conscious that the Central Excise Act, 1944 in providing for the powers of the Appellate Tribunal did not make applicable the provisions of the Code of Civil Procedure as far as may be to appeals to it but those provisions have been made applicable as far as may be to appeals to the High Court. That being the situation we find no reason to not expect adherence to some procedure by the Tribunal in exercising appellate powers of making directions for remand and taking additional evidence.

23. In Sundaram Finance Ltd. (supra) the majority decision regarding the true effect of a transaction determined from the terms of agreement considered in the light of surrounding circumstances was that the agreement undoubtedly contains several onerous covenants but all intended to secure to the appellant (in that case), recovery of the amount advanced. The Supreme Court was accordingly of the view that the intention of the appellant in obtaining the hire purchase and the allied agreements was to secure to the appellant recovery of loans advanced to their customer and no real sale of the vehicle was intended by the customer to the appellant. The transaction was merely financing transaction. This decision was rendered on the facts that the appellant had granted loan to their customer upon having execution of nine documents including, inter alia, a sale letter reciting that the customer had, on the date of application for loan, sold the motor vehicle to the appellant. The sales tax authority contended that between the date on which the customer agreed to purchase a vehicle and the date on which he became full owner of the vehicle without any encumbrance, three sale transactions were interposed: a sale by the dealer to the customer; a sale by the customer to the appellant under the sale letter; and a sale by virtue of clause (6) of the Hire Purchase Agreement (upon repayment of the loan). On those facts the Supreme Court by its majority view determined the true nature of transaction of the appellant. The sales tax authority had founded their demand on the said documents. The High Court found in favour of the sales tax authority but the Supreme Court determined the true nature of the transaction in spite of the documents.

24. In the case before us the SCN was issued on, inter alia, the basis of -

"3.4 During verification of the relevant documents viz. Lease Agreements, Hire-Purchase Agreement, Loan Agreements and relevant statement of accounts and ledgers, it appeared that the said assessee is engaged in providing taxable service which is categorized under banking and other financial services in as much as the said assessee appears to have provided financial leasing services including equipment leasing, and hire purchase, for which no service tax liability has been discharged by the said assessee."

The Revenue ran their case before the adjudicating authority. Being aggrieved by the said order-in-original they approached the Tribunal. As aforesaid the Tribunal had before it sample agreements and the omission on the part of the Revenue to disclose any material before it for the purpose of obtaining directions for production of additional evidence on remand. The Tribunal found lack of assistance from the order of the Commissioner, since according to it, the Commissioner had not examined all the agreements. However, the Tribunal did not come to a finding that though the sample agreements said something but the true nature of transactions in relation thereto was something else.

25. The question is really of interpretation. In Sundaram Finance Ltd. (supra) the Supreme Court gave the interpretation of the transaction resulting from the agreement and other documents executed in that case. Here too the Revenue has urged an interpretation of, as according to it, the true nature of transactions emanating from the appellants documents as constituting transactions of taxable services on which Service Tax had not been paid. The Commissioner gave his interpretation while the Tribunal did not but remanded the matter with direction for taking additional evidence. The Revenue was unable to show that there was any material before the Tribunal that could persuade us to consider an interpretation possible otherwise than that given by the Commissioner, for the purpose of upholding the impugned order.

26. There is no record in the impugned order that the appellant refused, failed or neglected to produce any document or evidence before the Tribunal. Where investigation and inquiry were unable to bring to light material which could be the basis for directions to take additional evidence, we find that such directions in the impugned order have been made without reason. The adjudicating authority cannot be directed to fish out evidence. The Central Excise Intelligence and Investigation Manual require the SCN to be issued only after proper inquiry/investigation i.e., when the facts used are ascertained and allegations justified. The other particulars in the said Manual relied upon by the appellant also assume significance. The adjudicating authority is to adjudicate on the demand in the SCN based on the allegations made therein. There is no finding in the impugned order setting aside as erroneous a finding of the adjudicating authority, on the basis of materials that were there either before the adjudicating authority or before the Tribunal.

27. We reject the contention of the appellant that there was no adjudication regarding imposition of penalty. Section 78 before substitution provided for, inter alia, the penalty to be imposed. The appellant was put on notice by the SCN that the extended period of limitation stood invoked on allegations of violation of provisions which attract penalties under the. The said order recorded the defence submissions in extenso. We did not find any submission, made on behalf of the appellant before the adjudicating authority, regarding invocation of extended period of limitation, the consequences in the matter of imposition of penalties or the maintenance of specified records. The appellant also did not attempt to demonstrate, by reference to grounds taken before the Tribunal, that submissions had been made but not recorded in the said order. Where the appellant was on notice regarding peril of imposition of penalties and no submission had been made before the adjudicating authority with regard to the invocation of extended period of limitation on the ground of suppression attracting penal provisions, the portion in the said order extracted below, in our opinion, is sufficient adjudication in the facts and circumstances.

"The said assessee have obtained Service Tax registration on 23-8-2001. This shows that they believed that they were liable for payment of Service Tax against providing taxable service viz. "Banking and Other Financial Service". But they did not submit any ST-3 Returns required under section-70 of the Finance Act,94. For contravention of the provisions of section-70, the said assessee are liable for penalty under section-77 of the Finance Act, 94.

The said assessee after getting registration on 23-8-2001, started collection of Service Tax. It has been ascertained that they have collected Rs. 93 lakhs as Service Tax and shown in their books of accounts as "Contingency Deposit". This shows their any ST-3 Returns. This shows their suppression of facts with intent to evade payment of Service Tax. As such extended period in terms of proviso to Section 73(1) of Finance Act, 94 is applicable in this case. The said assessee are also liable for penalty under Section 78 of the Finance Act,94. As penalty is considered under Section 78 no penalty is imposed under section-76 of the Finance Act,94."

28. In the context of the facts in this case as found by the adjudicating authority, no part of the adjudicated demand can be said to be outside the purview of the scope of Section 73 prior to its substitution. Before that authority no ground had been taken that the SCN did not disclose reason to believe omission or failure on the part of the assessee or that such omission or failure was not covered under clause (a) sub-section (1) in Section 73 as it stood before substitution. There are specific findings of the adjudicating authority regarding omission, failure and suppression by the appellant on the allegations made in the SCN.

29. In Spandana Spoorthy Financial Ltd. (supra) the facts were that there was a composite order of assessment and penalty. The assessee had preferred an appeal before the Tribunal. The Tribunal directed pre-deposit of both the demand arising in the assessment order as well as the penalty imposed thereby. The court, in paragraph 3 of its order, after having in the earlier paragraph extracted the proviso to Section 35F of the Central Excise Act, 1944, said as follows :

"3. Therefore, it is clear that in view of insertion of the word or the Tribunal cannot ask to make pre-deposit in both at a time. According to us, the pre-deposit of the penalty amount will be required when the order of the penalty alone is under challenge. But if there is a composite order namely assessment order, tax component and also penalty order like here, direction for pre-deposit of any portion of the penalty amount would result in injustice as well as hardship. Under this circumstance, we are of the view that the direction for pre-deposit of penalty component of the order has to be deleted and is deleted and the rest portion of the order would remain."

The said order is not in aid of the appellant. It was rendered in a different context. The question of whether adjudgment of penalty is to be by separate proceedings was not before the said Court. Section 83A of the said Act is an enabling provision. On a reading of Sections 73, 78 and 83A we are unable to hold that upon determination of a demand, where the extended period of limitation has been invoked, the adjudication of penalty that stand attracted is to be made by initiating a separate proceeding. The penalty adjudged and direction made in regard thereto by the adjudicating authority is clearly under the provisions of Section 78 as it stood before substitution.

30. We, therefore, answer the questions in the affirmative and in favour of the appellant, except on the issues of recovery of Rs. 93 lakhs, suppression and imposition of penalties which are in favour of the Revenue. On the issue of Rs. 93 lakhs, we found concurrent findings rejecting the clarification sought to be tendered by the appellant. The impugned order is set aside and order-in-original dated 31st March, 2009, restored.

31. We wish to add that though in the impugned order it was recorded that both sides pleaded a time-limit be fixed for completion of the adjudication proceedings on remand and a further direction in that regard made therein with consent of the parties, this was not urged by the Revenue as a ground of maintainability or formulation of a question in regard thereto for adjudication in this appeal.

32. The appeals stand disposed of.