Mohammed Bilal Vs Assistant Commissioner (Kerala High Court)
The petitioner, a Clearing and Forwarding (C&F) Agent for M/s India Cements Ltd. (ICL), earned income from handling charges, hiring charges, service charges, and transportation charges. Service tax was paid by the petitioner on handling, hiring, and service charges, while service tax on transportation charges was paid by ICL under the reverse charge mechanism as per Notification No.30/2012 dated 20/06/2012. An audit conducted on 21 April 2010 by the Superintendent of Central Excise, Shri Ravi Varma Raja, directed the petitioner to include transportation of goods by road in his registration certificate. The petitioner did not comply, citing that ICL had already paid service tax for transportation.
The petitioner challenged an order dated 20 October 2017 issued by the same officer, now Assistant Commissioner, arguing that adjudication by the same person who earlier conducted the audit created a pre-disposed mind and biased decision-making process. The Central Excise Department argued that the impugned order did not rely on the audit and that the petitioner had appellate remedies available.
The Court observed that quasi-judicial authorities must act free from bias or prejudice, and that a pre-disposed mind is sufficient to establish an error in the decision-making process. Since the officer had earlier directed inclusion of transportation charges in 2010, the Court held that the impugned 2017 order was influenced by prior directions.
