Asgar Ali vs. The Union Of INDIA And 6 Ors.

Held

The Court disposed of the writ petition by setting aside and quashing the impugned Order in Original. The Court directed the petitioner to appear before the Assistant Commissioner, Central Goods and Service Tax, Bongaigaon Division, Dhubri, on 11.07.2019, and submit all original money receipts pertaining to payments made towards service tax for the construction of the godown. The Assistant Commissioner was then directed to verify these receipts and pass necessary orders regarding any Goods and Service Tax payable by the petitioner on behalf of the Central Warehousing Corporation. The Court also ordered that no coercive measures would be taken for recovery of service tax and penalty until the determination by the Assistant Commissioner, provided the petitioner appeared and submitted the receipts. However, if the petitioner failed to appear or produce receipts, the Assistant Commissioner would be at liberty to pass recovery orders.

Facts

The petitioner, Asgar Ali, is challenging an Order in Original dated 01.05.2018, passed by the Assistant Commissioner, Central Goods and Service Tax, Bongaigaon Division, Dhubri. This order imposed a service tax liability of Rs. 4,34,218/- and a penalty of a similar amount on the petitioner for alleged non-payment of service tax related to the construction of a 2000 MT Godown at Dhubri for the Central Warehousing Corporation. The petitioner contends that he has paid half of the service tax, with the remaining half being the responsibility of the Central Warehousing Corporation. Subsequently, a communication dated 31.01.2019 from the Assistant Commissioner to the State Bank of India sought recovery of Rs. 9,48,436/- from the petitioner, encompassing both the alleged service tax and penalty.

Key Issues

1. Whether the petitioner is solely liable for the entire service tax and penalty amount of Rs. 4,34,218/- each, as determined by the Assistant Commissioner, Central Goods and Service Tax, Bongaigaon Division, Dhubri, under Section 87(b) of the Central Goods and Services Tax Act, 2017. Petitioner's contention: The petitioner argued that he has already paid half of the service tax liability, and the remaining half was to be paid by the Central Warehousing Corporation. Therefore, he should not be held liable for the entire amount. Revenue's contention: The revenue, represented by the Assistant Solicitor General, submitted that the petitioner had made some deposits regarding service tax for the construction of the commercial industrial building for the Central Warehousing Corporation. They proposed that the petitioner appear before the Assistant Commissioner with relevant documents for inspection and determination of the actual service tax payable.