2015 (4) TMI 1128 - HC - Service Tax

Challenge to the show cause notice - demand of service tax - Held that - Petitioner instead of replying to show cause notice has approached this Court assailing the correctness of same on various grounds. - without expressing any opinion on the contentions raised, writ petitions are dismissed.

Summary

Issues:
Challenge to show cause notice for service tax, education cess, and recovery under Section 73(1) of the Finance Act, 1994 for the period 2009-10 and 2011-12.

Analysis:
The petitioner contested a show cause notice dated 14.10.2015, demanding payment of service tax, education cess, and secondary & higher education cess totaling &8377;10,57,35,977 for the period 2009-10 and 2011-12 under Section 73(1) of the Finance Act, 1994. The petitioner approached the court challenging the notice on various grounds without responding to it. The court emphasized the principle that interference at the show cause notice stage should be minimal, citing a judgment by the Hon'ble Apex Court. The court highlighted that unless the authority lacks power or jurisdiction to initiate the inquiry, parties should first utilize alternate remedies and raise objections during the proceedings. The court dismissed the writ petitions without delving into the raised contentions, granting the petitioner two weeks to file a reply or objections to the show cause notice. The first respondent was directed to adjudicate the notice on merits and in compliance with the law after considering the petitioner's response.

This judgment underscores the importance of allowing statutory authorities to complete their inquiries without premature interference. It reiterates the need for parties to exhaust alternate remedies and raise objections during proceedings rather than challenging show cause notices directly. The court's decision to dismiss the writ petitions while granting the petitioner an opportunity to respond to the notice ensures due process and the right to be heard before any final adjudication. The directive for the first respondent to consider the petitioner's reply or objections before making a decision emphasizes the significance of procedural fairness and adherence to legal principles in tax matters.