M/S.A. Ram Reddy vs. The Deputy Commissioner

Held

The Court held that the Petitioner's contention regarding the violation of principles of natural justice, specifically the lack of personal hearing, could not be accepted to invoke the writ jurisdiction under Article 226 of the Constitution of India. The Court noted that the Order-in-Original dated 30.03.2022 is an appealable order under Section 85 of the Finance Act, 1994. Consequently, the Court relegated the Petitioner to the appellate forum. The Court explicitly clarified that it had not expressed any opinion on the merits of the case. All contentions raised by the Petitioner were kept open for consideration by the appellate authority. The writ petition was dismissed on this ground.

Facts

The Petitioner, M/s. A. Ram Reddy, represented by its Proprietor Mr. Aileni Ram Reddy, filed a writ petition challenging an Order-in-Original No. 71/2021-22-Adjn dated 30.03.2022 and a Corrigendum to Order-in-Original No. 71/2021-22-Adjn dated 13.05.2022, both passed by the Deputy Commissioner (1st Respondent) and Assistant Commissioner (2nd Respondent) respectively. The challenge pertains to the tax period 2016-17 under the Service Tax regime as per the Finance Act, 1994. The Petitioner alleged that the order was passed without providing an opportunity of personal hearing, without granting exemption on the abatement portion, levying tax twice without proper inquiry, and was barred by limitation. The Petitioner also claimed violation of principles of natural justice and rule of law. The Petitioner sought to set aside these orders.

Key Issues

1. Whether the impugned Order-in-Original dated 30.03.2022, passed by the 1st Respondent, is liable to be set aside for violation of the principles of natural justice due to the alleged non-provision of a personal hearing to the Petitioner, as contended by the Petitioner? 2. Whether the Petitioner's contention that the extended period of limitation under the proviso to Section 73(2) of the Finance Act, 1994, is not available to the Respondents due to lack of evasion and the issue being one of double taxation, is valid, as argued by the Petitioner? Petitioner's arguments: The Petitioner argued that they did not receive notice for personal hearing, and there was no evasion of service tax, thus the extended period of limitation should not be available. They also claimed the issue was one of double taxation. The Petitioner also stated that while the show-cause notice dated 24.12.2020 was served, they could not respond due to the COVID-19 situation. Respondents' arguments: The Respondents contended that notices for personal hearing were issued to the Petitioner at the address provided in the writ petition, with four notices served and only two returned undelivered. They further argued that the Petitioner did not submit a reply to the show-cause notice despite being served.