2019 (1) TMI 383 - HC - Service Tax

Validity of demand of service tax - ex-parte order passed by the adjudicating officer - principles of natural justice - Held that - Admittedly, the petitioner was issued with the show cause notice dated 13.01.2017, calling upon them to show cause within the time stipulated therein as to why the service rendered by them in relation to sale of space to products placement in the motion picture should not be classified as 'Services' under Section 65(B) read with 65B(51) and the services in relation to temporary transfer or permitting the use of enjoyment of copyrights should not be classified under 'copyright service'. It is seen that the petitioner after receipt of the said notice did not file any reply. On the other hand, the record of personal hearing made by the Adjudicating Authority on 21.05.2018 clearly discloses that the petitioner though repeatedly asked for extension of time to file reply, had not submitted any reply, even though such time was granted. When such being the factual position I do not think that the learned counsel for the petitioner is entitled to contend that the Adjudicating Authority has not given sufficient opportunity to the petitioner - Neither Section 33-A of the Central Excise Act, 1944, contemplates the opportunity as expected by the petitioner herein. The order of adjudication passed by the respondent cannot be questioned before this Court under a writ jurisdiction, by complaining as if the principles of natural justice is violated - this Writ Petition is disposed of, by granting liberty to the petitioner to file such statutory appeal before the Appellate Tribunal.

Summary

Issues:
1. Maintainability of writ petition against the order in original dated 18.07.2018.
2. Sufficiency of opportunity given to the petitioner by the Adjudicating Authority.
3. Compliance with principles of natural justice in the adjudication process.
4. Right of the petitioner to file a statutory appeal before the Tribunal.

Analysis:
1. The writ petition challenged the order in original dated 18.07.2018. The petitioner argued that despite the availability of an appeal before the Customs Excise and Service Tax Appellate Tribunal, the writ petition was maintainable due to alleged lack of sufficient opportunity to defend the case before the Adjudicating Authority. The petitioner contended that the demand was invalid, justifying the writ petition.

2. The petitioner claimed that the Adjudicating Authority should have provided additional opportunities for the petitioner to respond to the show cause notice. However, the court found that the petitioner did not file any reply to the notice and failed to avail the granted time for submission. The court held that the Adjudicating Authority had given adequate opportunities, and the petitioner's argument lacked merit.

3. The court examined the facts and the order passed by the respondent, concluding that the petitioner's claim of insufficient opportunity was unfounded. The court noted that the petitioner did not submit a reply despite being granted extensions, undermining the petitioner's argument regarding the violation of natural justice principles.

4. The court emphasized that if the petitioner was dissatisfied with the impugned order on its merits, they had the right to file a statutory appeal before the Tribunal. The court disposed of the writ petition, granting the petitioner the liberty to file such an appeal within four weeks. The court clarified that the appeal would be considered independently on its merits and in accordance with the law, without being constrained by the period of limitation. The petitioner was also allowed to raise all objections before the Tribunal during the appeal process.