2015 (10) TMI 786 - HC - Service Tax

Delay in passing order - Recovery of service tax - Impugned order passed after a period of 22 months Petitioner contended that any unreasonable delay to be avoided in passing adjudication order Held That - sitting on files and for months together and sometimes beyond the financial year is, thus, not conducive to the interest of nation s economy. The trust and faith reposed in them is also then betrayed. If no action is taken against such Officers and they are allowed to go scot free, then, apart from the Revenue getting involved in litigation in higher Courts and Tribunal, others would be encouraged. Comprehensive affidavit needs to be filed by the Chief Commissioner of Service Tax stating measures taken or proposed to be taken - Number of files and matters pending and serially to be disclosed with complete data and figures Commissioner needs to inform the time required to complete all the pending cases.

Summary

Issues:
Impugned order passed by Commissioner of Service Tax after an inordinate delay, reliance on circulars emphasizing timely adjudication, lack of explanation for delay, concern over pending matters in Commissionerate, need for remedial measures to address delays.

Analysis:
The judgment pertains to a Writ Petition challenging the order passed by the Commissioner of Service Tax due to a significant delay of almost 22 months. The petitioner contended that the delay in passing adjudication orders, as highlighted in circulars by the Central Board of Excise and Customs, is unreasonable and obstructs the realization of public revenue promptly. The Supreme Court's stance on delays in pronouncing judgments was cited to emphasize the importance of timely adjudication to maintain trust in the judiciary and the institution. The Court noted the absence of a satisfactory explanation for the delay in this case, expressing concerns over the impact of such delays on public trust and revenue realization.

The Court acknowledged the need for expeditious handling of matters and expressed readiness to set aside the impugned order and remand the case for fresh hearing. However, the Court deferred immediate action due to broader concerns regarding the number of pending files and matters in the Commissionerate. The Court directed the Chief Commissioner of Service Tax to provide a comprehensive affidavit detailing the pending cases, measures taken or proposed to address delays, and the expected timeline for disposing of pending matters. Emphasizing the adverse consequences of prolonged delays on public interest and the economy, the Court highlighted the importance of swift action by the Commissionerate to resolve pending cases efficiently.

In light of the concerns raised, the Court scheduled a follow-up hearing for further review on 31st August 2015. The judgment underscores the significance of timely adjudication in upholding public trust, revenue collection, and the efficient functioning of the legal system. It calls for proactive measures to address delays, ensure expeditious resolution of pending cases, and maintain the integrity of the adjudicative process in matters related to service tax.