Kamla Construction & Co. And Swastik Enterprise (JV) Vs Principal Commissioner (Jharkhand High Court)
The Jharkhand High Court has set aside an Order-in-Original that imposed a service tax demand of over ₹90 million on Kamla Construction & Co. and Swastik Enterprise (JV). The judgment, delivered in a writ petition filed by the assessee, found that the tax authority had passed the order in violation of the principles of natural justice.
Lack of Due Process
The assessee argued that the ex-parte order was invalid because neither the initial show-cause notice dated September 29, 2020, nor any subsequent hearing notices were served on the company. The assessee’s petition highlighted that the lack of notice prevented it from presenting its case and supporting documents.
In response to the petition, the court directed the respondent, the Principal Commissioner, Central Goods & Service Tax (CGST), Ranchi, to produce the relevant records. The court examined the dispatch register and confirmed that the show-cause notice was indeed never served on the assessee.
The court’s finding confirmed the petitioner’s claim that it was not given a reasonable opportunity to be heard, a fundamental requirement of natural justice. The judgment concluded that the impugned order, dated March 27, 2023, could not be sustained.
