We have carried out muon spin relaxation (SR), neutron diffraction and inelastic neutron scattering (INS) investigations on polycrystalline samples of Ce(Ru 1-x Fe x ) 2 Al 10 (x=0, 0.3, 0.5, 0.8 and 1) to investigate the nature of the ground state (magnetic ordered versus paramagnetic) and the origin of the spin gap formation as evident from the bulk measurements in the end members. Our zero-field SR spectra clearly reveal coherent two-frequency oscillations at low temperature in x=0, 0.3 and 0.5 samples, which confirms the long-range magnetic ordering of the Ce-moment with T N =27, 26 and 21 K respectively. On the other hand the SR spectra of x=0.8 and x=1 down to 1.4 K and 0.045 K, respectively exhibit a temperature independent KuboToyabe term confirming a paramagnetic ground state. The long-range magnetic ordering in x=0.5 below 21 K has been confirmed through the neutron diffraction study. INS measurements of x=0 2 clearly reveal the presence of a sharp inelastic excitation near 8 meV between 5 K and 26 K, due to an opening of a gap in the spin excitation spectrum, which transforms into a broad response at and above 30 K. Interestingly, at 4.5 K the spin gap excitation broadens in x=0.3 and exhibits two clear peaks at 8.4(3) and 12.0(5) meV in x=0.5. In the x=0.8 sample, which remains paramagnetic down to 1.2 K, there is a clear signature of a spin gap of 10-12 meV at 7 K, with a strong Q-dependent intensity. Evidence of a spin gap of 12.5(5) meV has also been found in x=1.The observation of a spin gap in the paramagnetic samples (x=0.8 and 1) is an interesting finding in this study and it challenges our understanding of the origin of the semiconducting gap in CeT 2 Al 10 (T=Ru and Os) compounds in terms of hybridization gap opening only a small part of the Fermi surface, gapped spin waves, or a spin-dimer gap.