Service Tax Demand Passed without affording opportunity to file reply: Orissa HC Allows One Chance to File Reply [Read Order]

The Orissa High Court allowed one chance to file a reply against the service tax demand order passed without affording an opportunity to file reply. The Court viewed that the petitioner ought to be given one more chance to first reply to the show cause notice ( SCN ) and then appear before the assessing authority for a fresh assessment order.

M/s. Abhimanyu Mohanty, the petitioner challenged the order of the Assistant Commissioner, GST & Central Excise, Angul Division, Angul (Opposite Party) under Sections 73(1), 75 and 78 of the Finance Act, 1994 along with interest and penalty for the tax period 2016-17.

Sections 73(1), 75, and 78 of the Finance Act, 1994, pertain to the provisions for recovery, interest, and penalties related to service tax. Section 73 emphasises the opportunity to respond, a notice will require the person to show cause why they should not pay the amount specified in the notice.

After considering the representation, if any, made by the person, the officer shall determine the amount of service tax due from such person and thereupon issue an order.

A perusal of the impugned order revealed that it was passed ex parte. In fact, the petitioner was unable to appear and did not even file a reply to the Service tax show cause notice ( SCN ) issued to him preceding the above assessment order. The petitioner has explained how he was not served with any notice for which he was not able to file reply to the show cause notice.  

The division bench of Justice Dr.  B R Sarangi and Justice G Satapathy viewed that the petitioner ought to be given one more chance to first reply to the SCN and then appear before the assessing authority for a fresh assessment order to be passed in accordance with law. 

While setting aside the impugned assessment order, the Court directed the petitioner will first file a reply to the SCN on or before 15.07.2024. Further, the matter will thereafter be taken up by the opposite party on 18.07.2024, and after hearing the petitioner, a fresh assessment order shall be passed within a period of two months thereafter.

To Read the full text of the Order CLICK HERE

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