Failure to Prove Service of Show-Cause Notice of Service Tax Demand: Gauhati HC sets aside ₹16.37 Lakh Demand Order [Read Order]

The Gauhati High Court has quashed an Order-in-Original that had confirmed a service tax demand of ₹16,37,501, along with cess, interest, and penalties, for the financial year 2016-17.

The Court found that the tax department had failed to produce any evidence showing that the underlying show-cause notice was ever served on the petitioner. The case was heard by Mr. Justice N. Unnikrishnan Nair.

The petitioner, Dhanjit Kumar Pathak had challenged the order on the primary ground that no show-cause notice or hearing notice was ever served before the adjudication took place.

A perusal of the impugned order revealed that the adjudicating authority had purportedly issued a demand-cum-show-cause notice dated 22 October 2021. However, despite the Court’s specific direction, the department failed to place any material on record to prove service of this notice.

When the matter came up for hearing, counsel for both sides jointly submitted that the order could be set aside and the case remanded to the Deputy Commissioner, CGST, Guwahati, Division-II, for fresh adjudication.

Accepting this joint submission, the High Court set aside the 30 March 2023 order and directed the petitioner to appear before the Deputy Commissioner on 28 August 2025. On that date, the authority must furnish, with due acknowledgment, a copy of the original show-cause notice dated 22 October 2021 and any annexures, said the court.

After that, the petitioner has fifteen days to submit a thorough response. The court directed the Deputy Commissioner must follow the law, give the petitioner a fair hearing, and issue a new Order-in-Original that should be shared with them.

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