M/S Ksb Train Cargo Carrier vs. The Additional Commissioner Of Central Tax
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Cause title — parties, addresses and appearances
ORAL ORDER
The petitioner's grievance is with the Order-in- Original dated 29.07.2025 [Annexure-A] under Section 65B of the Finance Act, 1994 [for short, ‘the Act’] and relates to the period between October 2015 to June 2017. The petitioner is issued with the Show Cause Notice which reads that the petitioner has carried out ‘certain activities’ that are covered under the definition of ‘Service’ under Sections 65B[44] and 65B[51] of the Act.
The petitioner has responded to this Show Cause Notice by the Reply dated 04.08.2023 [Annexure-C] specifically stating that the petitioner deals with highly perishable goods such as hatching eggs, vegetables, flowers, fruits and other items describing its responsibility as involving ensuring unloading of the produce from vehicles which are used by the farmers to transport these perishable goods to the railway station and load it on to the HC-KAR
CNR: KAHC010373742026 NC: 2026:KHC:37676 leased Seating cum Luggage Rake [SLR] of the Department of Railways to forward these produces to the purchasers.
Sri B G Chidananda Urs, the learned counsel for the petitioner, submits the following on the impugned Show Cause Notice and the continuing the proceedings thereunder.
This Court must intervene with the very Show Cause Notice because the Show Cause Notice is tentative inasmuch as it does not describe the nature of the petitioner’s service.
It is salient that the Show Cause Notice must be definite about the service and the exigibility thereof, and the Registered Taxable Person [RTP] must be extended an opportunity in the light of these definite terms to offer an explanation. HC-KAR
CNR: KAHC010373742026 NC: 2026:KHC:37676 If a Show Cause Notice fails on these salients, the entire proceedings must lapse.
Sri B G Chidananda Urs submits that, in the alternative, he would canvass for an opportunity to file documents now available with the petitioner to demonstrate that it is in the business of transportation of perishable goods such as hatching eggs, vegetables, fruits and flowers. In elaboration, the learned counsel submits the following. [a] the petitioner is registered for service tax in the month of April 2008, [b] the petitioner has filed ‘Nil’ returns because its service of transportation of perishable goods as aforesaid is exempt from Service Tax, [c] the Authorities have accepted these ‘Nil’ Returns and the present Show Cause Notice [for the period between October 2015 to June 2017] is issued only because of the details in the Income Tax Returns, [d] the petitioner, with the march of time, may not have the HC-KAR
CNR: KAHC010373742026 NC: 2026:KHC:37676 last Invoice or Manifest for every last quantity of the perishable goods supplied and [e] the authorities must consider whether the petitioner has produced substantial material to establish its case that its services has always been exempted.
Sri Madhu N Rao, the learned counsel for the respondent, relies upon the fact that the petitioner has not produced either invoices or manifests to justify its case. The question for consideration is: Whether this Court must intervene to quash the entire proceedings or restore the proceedings with an opportunity to the petitioner to produce material as would be permissible at this length of time, with certain observations.
This Court is of the view that the question whether the proceedings must fail with the Show Cause Notice itself can be deferred for the present and the petition be disposed of with liberty to the HC-KAR
CNR: KAHC010373742026 NC: 2026:KHC:37676 petitioner to show cause against the confirmation interfering with the impugned Order-in-original. The petitioner is categorical that some Invoices and Manifests can be produced apart from other documents which would demonstrate the nature of transport.
This Court is persuaded to so opine because the petitioner if it can produce documents such as Invoices and Manifests or other documents which show the nature of transport relevant to the following transactions which are referred to in the impugned order, there could be a complete adjudication. This Court must also observe that given the length of time, the Authorities cannot take a pedantic approach and insist upon the petitioner to produce every Invoice/ Manifest to justify each and every supply. HC-KAR
CNR: KAHC010373742026 NC: 2026:KHC:37676
The Authority concerned, if the documents produced show, generally, the nature of transport, must examine whether the petitioner is able to demonstrate that the supplies during this period are substantially those of perishable goods. This Court, in arriving at this conclusion, has considered circumstances such as that petitioner is registered in the year 2008, has filed ‘Nil’ Returns until the present period, these Returns are accepted and the impugned proceedings are only because of certain information shared by the Income Tax Department. In the light of the afore, the following
ORDER
[A] The petition stands disposed of with liberty to the petitioner to file along with a certified copy of this order, Invoices, Manifests or other documents that would demonstrate the nature of the goods transported for the period as HC-KAR
CNR: KAHC010373742026 NC: 2026:KHC:37676 mentioned in the subject Show Cause Notice. [B] The petitioner is reserved with liberty to produce these documents within eight [8] weeks from the date of receipt of a certified copy of this order. [C] The respondent shall consider the materials placed by the respondent in the light of this Court's observation with a pedantic or a technical approach. (B M SHYAM PRASAD) JUDGE AN/-
Reproduced from the public record of the Karnataka High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.