Shaista Praween vs. The Assistant Commissoner Of GST And Central Excise, Rourkela

Held

The Court held that the Order-in-Original dated 04.05.2023 was non est in the eyes of law and a nullity because it was passed against a deceased person. The Court found that there is no statutory provision in Chapter-V of the Finance Act, 1994, that allows for the continuation of proceedings under Section 73 against the legal heir of a deceased service provider. This principle was supported by the Supreme Court's decision in Shabina Abraham Vrs. Collector of Central Excise and Customs. The Court also noted that the authority failed to consider the vital evidence of the death certificate provided by the petitioner. Consequently, the demand raised and the contemplated recovery action under Section 87 of the Finance Act, 1994, vide the letter dated 05.04.2024, were deemed invalid. The Court quashed the Order-in-Original and the direction to discharge liability.

Facts

The petitioner, Shaista Parween, assailed an Order-in-Original dated 04.05.2023 passed by the Assistant Commissioner, GST and Central Excise, Rourkela-I Division. This order raised a demand of service tax for the Financial Year 2015-16 under Chapter-V of the Finance Act, 1994. Subsequently, on 05.04.2024, a notice was issued in the name of the petitioner's deceased husband, Sarfaraz Ahmad, demanding Rs. 66,67,040/- plus interest. The petitioner had previously informed the authority on 02.08.2024 about her husband's death on 27.04.2020, providing a death certificate. Despite this, the Order-in-Original was passed and recovery action was threatened against the petitioner. The petitioner filed a writ petition seeking to quash the Order-in-Original and subsequent proceedings.

Key Issues

1. Whether the Assistant Commissioner was justified in passing an Order-in-Original against a deceased person, ignoring the intimation of death and death certificate provided by the petitioner, thereby rendering the order non est in law? 2. Whether proceedings under Chapter-V of the Finance Act, 1994, specifically Section 73, can be continued against the legal heir of a deceased service provider in the absence of an explicit statutory provision? Petitioner's arguments: The Order-in-Original is a nullity as it was passed against a dead person, and proceedings must abate in the absence of a statutory provision for continuation. The liability was based on presumption, and the authority failed to ascertain if the services fell within the scope of taxable services or exemptions. Unlike the Income Tax Act, 1961 (Section 159), the Finance Act, 1994, lacks a provision to continue proceedings against legal representatives, as held in Shabina Abraham Vrs. Collector of Central Excise and Customs. The revenue did not controvert this lack of explicit provision. Revenue's arguments: Not recorded in the judgment.