2021 (8) TMI 1324 - HC - Central Excise

Violation of principles of natural justice - disinclination of petitioner for availing opportunity of personal hearing - penalty proceedings - failure to pay service tax - HELD THAT - With an averment that the petitioner has failed to pay the service tax, show cause notice (Ext.P1) was issued, to which the petitioner has tendered reply at Ext.P2. On some occasion, the assessment proceedings were deferred at the request of the petitioner. Ultimately, the proceedings were fixed for personal hearing of the petitioner on 24-11-2020. By the notice of hearing dated 11-11-2020 (Ext.P4), the petitioner was communicated date of hearing as 24-11-2020. He was directed to appear in person or through his authorised representative. Bare reading of communication at Ext.P5 sent by the petitioner to the respondent makes it clear that the petitioner expressed his disinclination for availing opportunity of personal hearing and requested the authority to drop the penal proceedings against the firm - In this view of the matter, the records show that the petitioner was afforded opportunity of personal hearing in the matter which the petitioner declined to avail. In this view of the matter, it cannot be said that the impugned order suffers from viz. of violation of principles of natural justice. The impugned order is an appealable order. Petition dismissed.

Summary

Issues:
1. Failure to attend personal hearing due to COVID-19 pandemic.
2. Allegation of non-compliance with principles of natural justice.
3. Request for dropping penal proceedings against the firm.

Analysis:
1. The petitioner's counsel highlighted the show cause notice (Ext.P1) and the subsequent reply (Ext.P2), emphasizing that due to the COVID-19 pandemic, the partners of the petitioner firm were unable to travel for the personal hearing scheduled at Kozhikode. The petitioner's request for adjournment was misinterpreted by the respondents, leading to the contention that the impugned order should be set aside for non-compliance with natural justice principles.

2. Upon examination, it was revealed that the petitioner had been issued a notice of hearing on 11-11-2020 (Ext.P4) for a personal hearing on 24-11-2020. The petitioner's response in communication at Ext.P5 expressed reluctance to attend the personal hearing due to the pandemic and requested the authority to drop penal proceedings against the firm. The respondent's decision, as reflected in the impugned order (Ext.P6), indicated that the petitioner declined the opportunity for personal hearing, leading to the conclusion that the impugned order was not in violation of natural justice principles and was appealable.

3. The respondent's observations in the impugned order highlighted that the petitioner was given multiple opportunities for personal hearing, which were not utilized. The petitioner's communication expressing disinterest in attending the hearing and requesting the dropping of proceedings against the firm further supported the respondent's decision. Consequently, the court concluded that the petitioner was afforded the opportunity for personal hearing, which was declined, and therefore, the impugned order did not contravene natural justice principles. As a result, the writ petition was rejected.