Karanveer Singh Yadav Enterprises Private Limited Vs Union of India (Patna High Court)
Patna High Court held that order is liable to be set aside since authority has failed to determine liability within prescribed period of one year u/s. 73(4B)(b) of the Finance Act without any justifiable reasons. Accordingly, order set aside and demands quashed.
Facts- Petitioner-company is engaged in providing services to their clients of “Erection Commissioning and Installation Service” as defined u/s. 65(105) of the Finance Act, 1994. Vide the present petition, the petitioner has mainly contested the impugned order-in-original passed by Respondent No. 2 whereby the tax liabilities and penalties for the Financial Year 2016-17 to 2017-18 (upto June, 2017) were imposed against the Petitioner under the Finance Act, 1994. It is mainly contested that the liability is confirmed in a most arbitrary manner without following the statutory provisions as well as the principles of natural justice.
Conclusion- In the case of M/s Kanak Automobiles, the learned co-ordinate Bench of this Court has, though, held that the period prescribed in clause (b) of sub-section (4B) of Section 73 of the Finance Act cannot be taken as an absolute mandate that the proceeding should be completed within one year from the notice but at the same time, the learned co-ordinate Bench has recorded “.. but it requires the statutory authority to take all possible steps, so to do and conclude the proceedings within an year. No steps were taken in the entire one year period, which results in the frustration of the goal of expediency as required statutorily. We hence find that the proceedings cannot be continued.
