2019 (8) TMI 1433 - HC - Service Tax

Opportunity to show cause - Demand of service tax - respondent in his wisdom and at his discretion has chosen to give a personal hearing to the writ petitioner and that personal hearing was undisputedly held on 15.11.2016, prior to the 'Goods and Service Tax' (GST) regime, which started operating on and from 01.07.2017 - HELD THAT - Personal hearing was held by the Commissioner of Service Tax-II. It comes to light from the impugned order, more particularly, paragraphs 3.1 and 4.2 that after the GST regime came into force on 01.07.2017, the instant matter was assigned to the respondent viz., Commissioner of GST and Central Excise, Chennai -Outer by the principal Chief Commissioner of GST and Central Excise. In the instant case, it so happens that the same incumbent i.e., G.Ravindranath, Commissioner of Service Tax-II, Chennai, who held the personal hearing on 15.11.2016, became the Commissioner of GST and Central Excise post GST regime and therefore, he passed the impugned order based on the assignment of work made by the Principal Chief Commissioner of GST and Central Excise and the personal hearing held on 15.11.2016. Between the date of personal hearing (15.11.2016) and the date of impugned order (26.07.2018), more than 11/2 years, 20 months to be precise, have elapsed - List this matter on 13.08.2019 in the 'Motion List'.

Summary

Issues:
1. Validity of the order made under Section 73 of Finance Act, 1994 regarding service tax
2. Delay between personal hearing and issuance of impugned order

Analysis:
1. The judgment concerns an order made under Section 73 of the Finance Act, 1994, related to service tax, which has been challenged. The order, referred to as the 'impugned order,' was dated 26.07.2018 and bears a specific Reference No. The writ petitioner argues that the impugned order was served on them on 29.08.2018. It is highlighted that while the opportunity to show cause is statutorily imperative, the respondent chose to provide a personal hearing to the writ petitioner on 15.11.2016, before the Goods and Service Tax (GST) regime came into effect on 01.07.2017. The personal hearing was conducted by the Commissioner of Service Tax-II. Post the implementation of GST, the matter was reassigned to the Commissioner of GST and Central Excise, Chennai - Outer. The same individual who conducted the personal hearing pre-GST regime became the Commissioner post-GST and passed the impugned order based on the reassignment of work.

2. The judgment also addresses the significant delay between the personal hearing held on 15.11.2016, and the issuance of the impugned order on 26.07.2018, which amounts to more than 11/2 years or 20 months. The learned Standing Counsel for Customs and Indirect Taxes accepts the notice on behalf of the sole respondent and requests time to obtain instructions. The matter is scheduled to be listed on 13.08.2019 for further proceedings. The delay between the personal hearing and the final order raises concerns regarding procedural fairness and adherence to timelines in adjudication proceedings.