2020 (1) TMI 1724 - HC - Service Tax

Challenge to SCN seeking to recover service Tax on service sim cards sold by the Petitioner for BSNL (Bharat Sanchar Nigam Limited) - HELD THAT - Since the Petitioner has cases in their favour the Petitioner should approach the First Respondent for Adjudication of Show Cause Notice under the Finance Act by citing the decisions. The First Respondent is directed to pass appropriate order within a period of three months from the date of receipt of a copy of this order. While passing the order the Respondents shall keep in mind the cited orders - Petition disposed off.

Summary

The Madras High Court, through Justice C. Saravanan, addressed writ petitions seeking a Writ of Prohibition to restrain the First Respondent from proceeding with Show Cause Notices and consequential proceedings under the Finance Act, 1994, regarding service tax recovery on sim cards sold by the Petitioner for BSNL. The Petitioner contended that BSNL, as the ultimate service provider, had already collected and paid the service tax, negating any further tax demand on the Petitioner.The Court noted the Petitioner relied on multiple prior orders from tribunals and appellate authorities supporting their position. The Respondent acknowledged no conflicting decisions currently exist.The Court held that since the Petitioner has favorable precedents, they should seek adjudication from the First Respondent by citing these decisions. The First Respondent was directed to pass an appropriate order within three months, ensuring the Petitioner is given an opportunity to file a reply and be heard. The writ petitions were disposed of without costs.