In a recent judgement, the High Court of Orissa held that a service tax notice issued after 10 years is not valid and quashed the same.
M/s. Satish Ch. Das & Co., the petitioner challenged the notice dated 23rd April 2007 and letter dated 30th October 2017 issued by the Department asking the Petitioner to appear personally in connection with an earlier Show Cause Notice (SCN) issued by the Commissioner on 23rd April 2007.
It was stated that the SCN was in connection with the case of the Department regarding non-payment of service tax by the Appellant providing ‘Port Services’. It appears that no action was taken under the above SCN issued on 23rd April 2007 which was for the period 1st October 2005 to 31st March 2006. The Petitioner was under the impression that the Department had dropped the proceedings.
After the lapse of 10 years second impugned notice dated 30th October 2017 was issued to the Petitioner asking him to appear for the hearing. The Petitioner filed an application dated 9th November 2017 before the authority expressing its inability to collect documents after such a long lapse of time. It was submitted that on 11th December 2017, an interim order was passed staying further proceeding under the impugned notices. That interim order has continued.
Under the notice issued, a counter affidavit was filed by the Department where inter alia reference has been made to the pendency in the Supreme Court of India of Civil Appeal No.1765 of 2009 which was the Department’s appeal against an order of the CEST Tax answering the issue in favour of the assessee. It was evident that the said appeal was dismissed by the Supreme Court of India by the order dated 11th January 2023.
After considering the observation made in the case of Commissioner of Central Excise, Mangalore vs. M/s. Konkan Marine Agencies, the Coram comprising Chief Justice Dr S. Muralidhar and Justice M S Raman quashed the impugned notice dated 23rd April 2007 and further letter dated 30th October 2017 issued by the Department to the Petitioner. Further allowed the petition.
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