Jeyasingh.G, Proprietor Of M/S. Sri Paulthai Lorry vs. The Joint Commissioner

Facts

The petitioner, G. Jeyasingh, filed a writ petition challenging Order in Original No. 24/JC/ST/2018 dated 25.09.2018, passed by the Joint Commissioner of CGST and Central Excise. This order confirmed a demand of Rs. 52,04,404/- towards Service Tax, Education Cess, and Secondary & Higher Education Cess for the period from 01.07.2012 to 16.02.2014, along with interest and penalties under Sections 73(2), 77(1)(c), 77(2), and 78 of the Finance Act, 1994. The petitioner later impleaded the Central Warehousing Corporation (CWC) as the second respondent, after obtaining a certificate from them regarding services provided by the petitioner. The revenue opposed the petition, citing delay in filing and the petitioner's failure to file an appeal. The writ petition was filed on 17.09.2021, while the impugned order was dated 25.09.2018.

Held

The Court held that the writ petition, despite the delay, could be entertained. The Court found merit in considering the letter dated 27.03.2019 issued by the Central Warehousing Corporation (CWC), the second respondent. The Court noted that the petitioner had not provided a proper reply to the original show cause notice. Therefore, the Court decided to set aside the impugned order and remit the case back to the first respondent (Joint Commissioner) for passing a fresh order. The impugned order was to be treated as an addendum to the original show cause notice. The petitioner was directed to file a consolidated reply within 30 days of receiving the order. The first respondent was to pass a fresh order on merits within 3 months thereafter. As a condition for the fresh order, the petitioner was directed to deposit 25% of the disputed tax within 30 days. The Court expressly left undecided the question of whether the writ petition was maintainable solely on grounds of delay, focusing instead on the substantive issue raised by the CWC letter.

Key Issues

1. Whether the writ petition is maintainable on grounds of delay and latches, considering the impugned order was passed on 25.09.2018 and the writ petition was filed on 17.09.2021? (Question of law) 2. Whether the impugned order, which confirmed a demand of Service Tax and imposed penalties, can be quashed and set aside in light of the letter dated 27.03.2019 issued by the Central Warehousing Corporation? (Question of mixed law and fact) Petitioner's arguments: The petitioner sought to quash the impugned order. While not explicitly detailed, the impleadment of CWC and reliance on its letter suggest an argument that the CWC's communication would impact the validity of the demand. The petitioner also obtained a certificate from CWC. Revenue's arguments: The revenue contended that the writ petition is devoid of merits and not maintainable due to significant delay (laches). They argued that at this distant point in time, neither a writ petition nor an appeal before the Appellate Commissioner would be permissible, citing the Supreme Court's decisions in M/S. Singh Enterprises Vs. Commissioner of Central Excise, Jamshedpur and others and Assistant Commissioner (CT) LTU, Kakinada and others Vs. Glaxo Smith Kline Consumer Health Care Limited.