Suthahar.T vs. The Commissioner

Held

The Court held that the petitioner had justifiable reasons for seeking adjournments, particularly on the latest occasions, citing the death of his mother, supported by a death certificate. The Court found that the adjudicating authority had not afforded adequate opportunity of personal hearing to the petitioner, thus violating principles of natural justice. Consequently, the impugned order-in-original was quashed. The matter was remitted back to the file of the second respondent (Joint Commissioner) to redo the adjudication proceedings afresh. The Court directed that only one more personal hearing notice would be issued, and on the notified date, the petitioner must appear, with no further reasons for adjournment to be entertained.

Facts

The petitioner, a government contractor, is challenging an order-in-original dated January 28, 2021, passed by the Joint Commissioner, CGST and Central Excise. The dispute pertains to the period from April 1, 2015, to June 30, 2017, concerning alleged non-payment of service tax on works contracts. The department's case is that service tax was not paid, while the petitioner claims exemption as the contracts were with government departments. A show cause notice was issued on November 12, 2019. The petitioner sought adjournments for personal hearing on multiple occasions, citing the death of his auditor and then his mother. The adjudicating authority, deeming the petitioner to be delaying the proceedings, passed the impugned order without further hearing.

Key Issues

1. Whether the adjudicating authority erred in passing the order-in-original without affording adequate opportunity of personal hearing to the petitioner, thereby violating principles of natural justice, particularly in light of the reasons provided for adjournment? Petitioner's contention: The petitioner argued that the adjournments sought were for justifiable reasons, including the death of his mother, and that the adjudicating authority failed to consider these reasons and proceeded to pass the order without granting a proper personal hearing. The petitioner relied on the death certificate of his mother as evidence. Revenue's contention: The respondents contended that the petitioner was deliberately dragging on the proceedings and that the authority was justified in passing the order due to repeated adjournments.