2023 (3) TMI 834 - HC - Service Tax

Principles of Natural justice - long delay of 13 years in adjudication of SCN - HELD THAT - Admittedly, Petitioner has participated in the adjudication proceedings from time to time. The grounds raised before the adjudicating authority as well as in this petition appear to be on merits. The issue of delay of 13 years in adjudicating the show cause notice can also be raised by the Petitioner in an appeal under section 35B of the Excise Act,1944 which provides for an appellate remedy against an order-in-original before the Tribunal. Neither there is any allegation nor the learned counsel has been able to demonstrate that there has been any breach of the principles of natural justice. It is deemed appropriate to relegate the Petitioner to the remedy of appeal under section 35B of the said Act. Petition dismissed.

Summary

Issues:
The issues involved in the judgment are the demand of service tax against two parties, the delay in adjudication proceedings, and the consideration of defense submissions.

Demand of Service Tax:
The Petitioner, a company engaged in oil and gas exploration, entered into contracts with Respondent No.3 for survey and exploration services. A show cause notice was issued for a demand of service tax against ONGC and CGG Marine. The order confirmed the demand against ONGC but dropped it against CGG Marine. Respondent No.3 had charged and deposited service tax, as stated in their reply.

Delay in Adjudication Proceedings:
The Petitioner participated in the adjudication proceedings over the years, with hearings and submissions. The Petitioner raised concerns about the 13-year delay in adjudication, stating it deprived them of the opportunity to explain and defend their case. The impugned order was passed after a long delay, leading to the petition to quash it.

Consideration of Defense Submissions:
The Respondents argued that the Petitioner's submissions were considered in the impugned order-in-original, despite the delay. The Respondents contended that the order was reasoned, and the Petitioner had the chance to defend themselves. It was suggested that the Petitioner could raise their contentions in an appeal under section 35B of the Excise Act, 1944. The court noted that the Petitioner participated in the adjudication proceedings and could pursue remedies through the appellate process. The court dismissed the petition, allowing the Petitioner to appeal to the Tribunal.