2015 (6) TMI 473 - HC - Service Tax

Application to move to the settlement Commissioner - Demand of duty and interest - Held that - Petitioner admitting their tax liability, has also paid a sum of ₹ 14,57,464/ towards service tax and ₹ 9,70,000/ towards interest. Therefore the request made by them in their application dated 03.11.2014 to permit them to approach the Settlement Commissioner could have been considered by the respondent. As he did not do so, this court, taking note of the fact that the petitioner had also paid the tax liability alongwith interest as mentioned above, is of the view that this is a fit case to find out whether they should be allowed to settle and redress his grievance before the Settlement Commissioner. - Decided in favour of assessee.

Summary

Issues:
Challenge to order demanding service tax, interest, and penalty under the Finance Act based on admitted liability. Request to approach Settlement Commissioner denied.

Analysis:
The Writ Petition was filed challenging an order demanding a sum of Rs. 22,60,399 towards service tax, Education Cess, and Higher Education Cess for the years 2008-09 to 2011-12 under sections 73(2), 75, and 78 of the Finance Act. The petitioner admitted the liability and expressed willingness to pay the tax liability along with interest. Subsequently, payments were made towards the tax liability and interest, including through cash and selling ancestral property and jewels. The petitioner argued that the order should be set aside to allow approaching the Settlement Commissioner, as initially requested.

The petitioner contended that since they admitted the tax liability and made significant payments towards it, the request to approach the Settlement Commissioner should have been considered by the respondent. The respondent argued that since the petitioner invited the impugned order, directing them to approach the Settlement Commissioner was unnecessary, suggesting they should approach the appellate authority instead. The court noted the payments made by the petitioner towards the tax liability and interest, indicating a willingness to resolve the matter. Consequently, the court found it appropriate to allow the petitioner to settle and redress their grievance before the Settlement Commissioner.

Therefore, the court set aside the impugned order and granted the petitioner two weeks to approach the Settlement Commissioner from the date of receiving the order copy. The Writ Petition was disposed of with no costs, and the connected miscellaneous petition was closed.