2016 (4) TMI 1113 - HC - Service Tax

Validity of order passed ex-parte - Violation of principles of natural justice - Demand of Service tax - Invokation of extended period of limitation - Appellant provided services of protection, pipe laying using trenching/trenchless, reinstatement of trench, OFC cable blowing including other associated works to its clients - Appellant contended that it had carried out substantial part of work prior to levy of service tax and thus, there was no question of levy of tax on services rendered prior to date of levy of tax. Held that - appeal against the order of Commissioner (Appeals) was filed by the revenue before the Tribunal on 15.1.2009 but due to pendency before the Tribunal, it came up for hearing on 23.7.2014. No fresh notice of the date of hearing was received by the appellant. Thus, there was non appearance on the part of the appellant. The Tribunal after hearing the representative of the department allowed the appeal ex parte. Therefore, sufficient opportunity to represent its case was not afforded to the appellant before passing the impugned orders. Thus, there was violation of the principles of natural justice. - Appeal disposed of by remanding the matter back

Summary

Issues:
1. Application under Section 35G (2A) seeking condonation of delay in filing the appeal.
2. Appeal under Section 35G seeking quashing of orders passed by the Tribunal.
3. Violation of principles of natural justice.

Analysis:

1. The first issue in this case pertains to an application under Section 35G (2A) of the Central Excise Act, 1944 seeking condonation of delay in filing the appeal. The appellant cited non-receipt of the notice of hearing as the reason for the delay of 302 days in filing the appeal. The Tribunal dismissed the application, leading to the appeal seeking condonation of the delay. The High Court, after hearing both parties, condoned the delay of 302 days and disposed of the case.

2. The second issue revolves around an appeal filed under Section 35G of the Central Excise Act, 1944 seeking quashing of orders passed by the Tribunal. The appellant, engaged in providing various services, was issued a show cause notice regarding tax liabilities. Despite submitting evidence and arguments, the appellant's appeal was dismissed by the Tribunal ex parte. The High Court noted that the appellant was not given sufficient opportunity to present its case, leading to a violation of the principles of natural justice. Citing the importance of natural justice, the High Court quashed the impugned orders and remanded the case back to the Tribunal for a fresh decision after affording the appellant a proper opportunity to be heard.

3. The third issue raised in this judgment concerns the violation of principles of natural justice. The High Court emphasized the significance of natural justice in judicial proceedings, quoting the Canara Bank v. V.K. Awasthy case to underscore the importance of fair play and the right to be heard. The Court highlighted the audi alteram partem rule, stating that no one should be condemned unheard, and notice must be precise and unambiguous. The High Court concluded that the appellant was not given a fair opportunity to present its case before the Tribunal, leading to a violation of natural justice. As a result, the High Court quashed the previous orders and remanded the case for a fresh decision, ensuring the appellant's right to a fair hearing and representation.

This comprehensive analysis of the judgment highlights the key issues addressed by the High Court and the detailed reasoning behind the decision in each aspect of the case.