Case Law Details
Barua and Company Pvt. Ltd. Vs. Union Of India & Ors. (Meghalaya High Court)
The affidavit-in-reply filed by the assessee has robustly denied that the relevant email address to which the three notices of April, 2022 were issued belonged to the assesse or that such address had been furnished by any authorised officer of the assesse. It is apparent that the Department has failed to discharge the burden of proving that the notices for hearing had been served on the assessee for the assessee to be penalised for not availing of the opportunity of hearing.
As a consequence, it follows that the order impugned dated May 25, 2022 was passed without hearing the assessee and without affording the assessee an opportunity of being heard. Since the nature of the order was such that the assessee’s participation was necessary prior to the same being made, the order impugned dated May 25, 2022 is set aside and the position is set back to the stage of the show-cause notice.
The Department will now issue a reasonable notice for hearing to the assessee by email at contact@thelandmarkhotels.in as indicated in the writ petitioner’s affidavit-in-reply. Such notice should be issued to and received by the assessee within the next three weeks. By way of abundant caution and so that there is no scope for any further dispute, a copy of the relevant notice must be simultaneously forwarded to Mr. P. Das, Advocate at pratyushdas@gmail.com.
Accordingly, the writ petition succeeds as indicated above. It is made clear that the merits of the matter have not been gone into and it will be open to the Department to pass an appropriate order and take necessary steps in accordance with law.
FULL TEXT OF THE JUDGMENT/ORDER OF MEGHALAYA HIGH COURT
The writ petition directed against an order dated May 25, 2022 passed by the Service Tax Department was entertained, as evident from the order dated July 25, 2022, primarily on the ground that no notice of hearing before passing the impugned order was issued to or received by the petitioning assessee.
2. In this context, it may be relevant to set out the salient part of the order dated July 25, 2022:
“The challenge in this petition is to an order dated May 25, 2022. In effect, the impugned order finds the writ petitioner liable to pay service tax in excess of Rs.1.45 crore together with interest and penalty.
There is no dispute that an appeal lies from the impugned order. However, the writ petitioner submits that the order was passed without affording the petitioner any opportunity of hearing. In particular, the Court’s notice is drawn to paragraph 3 of the impugned order and the reference therein to notices dated April 7, 2022, April 22, 2022 and April 29, 2022 which were apparently served on the writ petitioner on April 20, 2022, April 29, 2022 and May 13, 2022, respectively.
At paragraph 20 of the petition, it has been clearly averred that the recording in such regard “is not true” and that no such notice was received by the petitioner whether at its registered office or at the unit in Shillong.
In view of such averment, the writ petition is entertained despite there being an alternative remedy to ascertain whether the relevant notices were issued to the writ petitioner or received by it.
Accordingly, the respondents will file an affidavit when the matter appears a fortnight hence confined to only such aspect of the matter, appending copies of the relevant notices for hearing and the corresponding proof of service in each case.”
3. The respondent authorities have filed an affidavit from which it is evident that the initial show-cause notice was duly received by or on behalf of the assessee. However, according to the Department, subsequent notices dated April 7, 2022, April, 22, 2022 and April 29, 2022 were issued to an email address apparently furnished by an authorised representative of the assessee. Indeed, the impugned order dated May 25, 2022 clearly refers to the notices dated April 7, 2022, April, 22, 2022 and April 29, 2022 which were apparently served on the assessee on April 20, 2022, April 29, 2022 and May 13, 2022, respectively, going unheeded.
4. As noticed in the order of July 25, 2022, the writ petition unambiguously indicated that the relevant notices of April, 2022 were not received by the assessee. It was, in such circumstances, that the writ petition was entertained despite noticing that the petitioner had a right of appeal against the order impugned.
5. Ordinarily, when an order assailed, which is otherwise amenable to appeal, is found to be contrary to the principles of natural justice or without jurisdiction or patently absurd, the writ court may not exercise the usual self-restraint in guiding the complainant to the appellate forum and entertain the writ petition itself. This is because the merits of the matter are scarcely required to be gone into such a scenario, particularly if the order impugned is found to be in breach of the principles of natural justice.
6. Since the order impugned dated May 25, 2022 was founded on the basis that the assessee had due notice and knowledge of dates of hearing fixed but the assessee had failed to be represented in course thereof, and it now appears that the assessee may not have received any of the three notices said to have been issued by email in April, 2022, the order impugned may not have any legs to stand on. The Department maintains that the email address to which the three notices of April, 2022 were sent was furnished by an authorised representative of the assessee, but there is no document to indicate the same and it is submitted on behalf of the Department that such information was furnished verbally.
7. The affidavit-in-reply filed by the assessee has robustly denied that the relevant email address to which the three notices of April, 2022 were issued belonged to the assesse or that such address had been furnished by any authorised officer of the assesse. It is apparent that the Department has failed to discharge the burden of proving that the notices for hearing had been served on the assessee for the assessee to be penalised for not availing of the opportunity of hearing.
8. As a consequence, it follows that the order impugned dated May 25, 2022 was passed without hearing the assessee and without affording the assessee an opportunity of being heard. Since the nature of the order was such that the assessee’s participation was necessary prior to the same being made, the order impugned dated May 25, 2022 is set aside and the position is set back to the stage of the show-cause notice.
9. The Department will now issue a reasonable notice for hearing to the assessee by email at contact@thelandmarkhotels.in as indicated in the writ petitioner’s affidavit-in-reply. Such notice should be issued to and received by the assessee within the next three weeks. By way of abundant caution and so that there is no scope for any further dispute, a copy of the relevant notice must be simultaneously forwarded to Mr. P. Das, Advocate at pratyushdas@gmail.com.
10. Accordingly, the writ petition succeeds as indicated above. It is made clear that the merits of the matter have not been gone into and it will be open to the Department to pass an appropriate order and take necessary steps in accordance with law.
11. WP (C) No.262 of 2022 along with MC (WPC) No.128 of 2022 are disposed of without any order as to costs.
