TMI Blog2021 (7) TMI 1064X X X X Extracts X X X X X X X X Extracts X X X X ..... ate, and without considering the laudable object behind issuing such circular, the respondents issued the impugned pre-show-cause notice consultation dated 12.4.2019 delivering the same to the petitioner assessee at 13.55 hours and calling upon them to remain present before the respondent No.2 at 16.00 hours. The petitioners having requested for reasonable time for the effective consultation, without considering the said request, the respondent No.2 issued the show-cause notice on the same day i.e. on 12.4.2019. Such a high-handed action on the part of the respondent No.2, not only deserves to be deprecated but to be seriously viewed. It is required to be noted that as such the demand made in the impugned show-cause notice was within the prescribed time limit. Now, since the said notice is sought to be set aside on the ground that adequate opportunity of hearing was not given to the petitioners for consultation prior to the issuance of the said notice, the petitioners cannot be permitted to take unfair advantage on the ground that the demand made in the notice had now become time-barred in view of the statutory provisions. The Court hereby sets aside the impugned notice da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... returns were also filed under the said Act evidencing payment of such tax under the transaction with M/s.Arvind Limited. However, during the course of audit for the year October 2013 to June 2017, the officers of the Service Tax Audit Team raised an objection that such consideration received from M/s. Arvind Limited was for supply of machineries and hence, was taxable service amenable to service tax. The Audit Team vide audit objection dated 28.2.2019 raised an objection for non-payment of service tax for the period 2016-17 to June 2017. Since it was not agreeable to the petitioner to the said view of the Audit Team, the said revenue para was concluded as unsettled . According to the petitioners, subsequent to the issuance of the said audit report, the petitioners had attempted to explain to the officers about the payment of appropriate sales tax for the transaction in question, however, all of a sudden the Superintendent of Central Tax Audit, Ahmedabad visited the office of the petitioners and handed over a copy of the letter dated 12.4.2019 at 13.55 hours, calling upon the petitioners to remain present on the same day at 14 hours before the respondent No.2. It was stated in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vs. Collector of Central Excise, reported in 1996(87) ELT 19 (SC) to submit that the circulars issued by the Board are binding to the officers of the department and are mandatory in nature. 5.Per contra, the learned Advocate Mr.Dhaval Vyas for the respondents submitted that during the course of audit, certain deliberations and discussions had taken place with the petitioner firm to promote voluntary compliance, however, the clarification tendered by the petitioner firm having been found to be unsatisfactory by the audit officers, final audit report was issued on 28.2.2019 towards the non-payment of the service tax. According to Mr.Vyas, the respondent authorities had given ample opportunity to the petitioners and had even tried to reduce the need to issue the show-cause notice by adhering to the procedure envisaged in the Circular dated 10.3.2017. In view of the said Circular the petitioner firm was issued the pre-show-cause notice on 12.4.2019, however, the petitioners sought time with a view to see that the demand made by the respondent authorities gets time-barred, in light of the fact that the returns for the relevant period were filed on 15.4.2014 and the five years for i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e past and to rescind the circulars which had lost relevance. Paragraph 5 of the said Circular deals with the consultation with the noticee before issue of show-cause notice. The said paragraph being relevant reads as under:- 5 . Consultation with the noticee before issue of Show Cause Notice: Board has made pre show cause notice consultation by the Principal Commissioner/Commissioner prior to issue of show cause notice in cases involving demands of duty above ₹ 50 lakhs (except for preventive/office related SCN s) mandatory vide instruction issued from F. No.1080/09/DLA/MISC/15, dated 21st December 2015. Such consultation shall be done by the adjudicating authority with the assessee concerned. This is an important step towards trade facilitation and promoting voluntary compliance and to reduce the necessity of issuing show cause notice. 8. In view of the afore-stated Circular, it is clear that the Board had made issuance of preshow- cause notice consultation mandatory for the Principal Commissioner/Commissioner prior to the issuance of show-cause notice in cases involving the demands of duty above ₹ 50 lac and that such consultation was to be done by the ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mit. Now, since the said notice is sought to be set aside on the ground that adequate opportunity of hearing was not given to the petitioners for consultation prior to the issuance of the said notice, the petitioners cannot be permitted to take unfair advantage on the ground that the demand made in the notice had now become time-barred in view of the statutory provisions. A precise observations made by the Supreme Court in this regard in case of The Director of Inspection of Income-tax (Investigation), New Delhi (supra) be reproduced as under:- 6. ... The Court in exercising its powers under Article 226 has to mould the remedy to suit the facts of a case. If in a particular case a Court takes the view that the Income-tax Officer while passing an order under s. 132(5) did not give an adequate opportunity to the party concerned it should not be left with the only option of quashing it and putting the party at an advantage even though it may be satisfied that on the material before him the conclusion arrived at by the Income-tax Officer was correct or dismissing the petition because otherwise the party would get unfair advantage. The power to quash an order under Article 226 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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