Home Case Index All Cases Service Tax Service Tax + HC Service Tax - 2023 (10) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (10) TMI 449 - HC - Service TaxLegality and validity of the impugned show cause notice - legality and validity of notice of personal hearing - delayed adjudication after lapse of more than 7 years which is contrary to provisions of Sub-section (4B) of Section 73 of erstwhile Chapter V of the Finance Act, 1994 - HELD THAT:- It transpires that the impugned show cause notice was issued vide letter dated 24.12.2014, thereafter the petitioner filed its reply to the said notice vide letter dated 04.10.2016 and the respondent No. 2 fixed the matter for personal hearing on 05.10.2016, on which date the petitioner duly appeared and made submissions. Thereupon, the adjudication of impugned show cause notice was kept in suspended animation for more than 7 years and now again the petitioner received a notice for personal hearing dated 21.06.2022 for adjudication of the show cause notice dated 24.12.2014. It further transpires that Section 73(4B) provides for determination of service tax liability and adjudication of the show cause notices within period of six months, “where it is possible to do so” in case where the show cause notice is issued under the main section 73(1) involving no suppression of facts etc. and within a period of one year where the show cause notice is issued under proviso to Section 73(1) of Chapter V of the Finance Act, 1994, where it is possible to do so - Sub-Section (4B) was inserted in Section 73 of Chapter V of the Finance Act, 1994 w.e.f. 06.08.2014 by Finance (No. 2) Act, 2014. Similar provisions exist under Section 11A (11) of the Central Excise Act, 1944 and Section 28(9) the Customs Act, 1962. The period of limitation of 6 months or 1 year under Section 73(4B) of the Chapter V of the Finance Act, 1994 be extended to more than seven years as is done in the instant case. In the case of KM SHARMA VERSUS INCOME TAX OFFICER [2002 (4) TMI 7 - SUPREME COURT] it is held by the Hon’ble Apex Court that the provisions of a fiscal statute more particularly one regulating the period of limitation must receive a strict construction as the law of limitation is intended to give certainty and finality to legal proceedings. In the case of SIDDHI VINAYAK SYNTEX PVT LTD. VERSUS VERSUS UNION OF INDIA & 2 [2017 (3) TMI 1534 - GUJARAT HIGH COURT] it is held by the Hon’ble Gujrat High Court that delay in deciding the proceedings without bringing it to the notice of the Petitioner that the case was transferred to the call book and was therefore pending causes immense prejudice and hence revival of proceedings after long gap without disclosing any reason of delay is in complete breach of the principles of natural justice. Alternatively, where no time limit has been prescribed the action should be completed within a reasonable time period. The reasonable time period U/s 73 is 5 years under Chapter V of the Finance Act 1994. In the instant case the matter is pending adjudication for more than 7 years - In the instant case period of more than 7 years from the issuance of impugned Show Cause Notice on 24-12-2014 cannot be said to be reasonable period for taking up/concluding adjudication proceedings. Section 73(1)/ 73(4) of Chapter V of the Finance Act, 1994 provides 5 years as a maximum period which in any case should be taken as reasonable period within which the adjudication should be completed. At this stage, it is worth mentioning that the objection of the Revenue with regards to alternative remedy and/or the judgments cited by the Revenue is not applicable in the instant case, inasmuch as, in the case at hand, now it would not be possible for the petitioner to defend its case effectively by culling out relevant records, evidences, producing its witness etc. thus, remitting the matter back would cause serious prejudices to the petitioner at this belated stage. There are no hesitation in quashing the impugned show-cause notice dated 24.12.2014 (Annexure-1) and impugned notice dated 06.06.2022 (Annexure-2) and the same are hereby quashed and set aside - the instant application stands allowed.
|