Case Note & Summary
The Petitioner, an advocate practicing in the Bombay High Court, challenged an Order-in-Original dated 26 October 2023 passed by the Deputy Commissioner, CGST and CX Division VI, Raigad Commissionerate, which confirmed a service tax demand of Rs.35,82,298/- along with interest and penalties under the Finance Act, 1994 read with the CGST Act, 2017. The Petitioner contended that the Respondent lacked territorial jurisdiction as her office is in Mumbai, not in Raigad, and that the order was passed in violation of natural justice. The Court noted that the Petitioner received an email on 5 October 2023 for a hearing on 17 October 2023, and she appeared through her Chartered Accountant. On 18 October 2023, she wrote a letter requesting documents and an opportunity to cross-examine, but the impugned order was passed on 26 October 2023 without considering her request. The Court held that the Deputy Commissioner had no jurisdiction to adjudicate the matter as the Petitioner's place of business is in Mumbai, and the order was passed in breach of natural justice. The Court quashed the impugned order and remanded the matter to the jurisdictional officer in Mumbai, directing that the Petitioner be given a reasonable opportunity of hearing.
Headnote
A) Service Tax - Territorial Jurisdiction - Deputy Commissioner lacked jurisdiction to adjudicate service tax liability of an advocate practicing in Mumbai, as the Petitioner's office is in Mumbai and not within Raigad Commissionerate - Held that the impugned order is without jurisdiction and liable to be set aside (Paras 1-6).
B) Natural Justice - Violation of Principles - The Petitioner was not given proper notice or adequate opportunity of hearing before passing the Order-in-Original - Held that the order suffers from procedural illegalities and breach of natural justice (Paras 2-4).
Issue of Consideration
Whether the Deputy Commissioner, CGST and CX Division VI, Raigad Commissionerate had territorial jurisdiction to pass the Order-in-Original against the Petitioner, an advocate practicing in Mumbai, and whether the order was passed in violation of principles of natural justice.
Final Decision
The Court allowed the petition, quashed the Order-in-Original dated 26 October 2023, and remanded the matter to the jurisdictional officer in Mumbai for fresh adjudication after giving the Petitioner a reasonable opportunity of hearing.
Law Points
- Territorial jurisdiction of tax authorities
- Principles of natural justice
- Service tax on legal services
- Section 73(1) Finance Act 1994
- Section 174 CGST Act 2017
Case Details
2024 LawText (BOM) (01) 224
Writ Petition No. 1085 of 2024
G. S. Kulkarni, Kishore C. Sant
Chetan Kapadia a/w Ruturaj Pawar for Petitioner, Sangeeta Yadav a/w Ashutosh Mishra for Respondents
The Deputy Commissioner, CGST and CX Division VI, Raigad Commissionerate & Ors.
Subscribe to unlock Case Details (Citation, Judge, Date & more)
Subscribe Now
Nature of Litigation
Writ Petition under Article 226 of the Constitution of India challenging an Order-in-Original passed by the Deputy Commissioner, CGST and CX Division VI, Raigad Commissionerate confirming service tax demand.
Remedy Sought
The Petitioner sought quashing of the Order-in-Original dated 26 October 2023 and setting aside of the service tax demand, interest, and penalties.
Filing Reason
The Petitioner contended that the Respondent lacked territorial jurisdiction and that the order was passed in violation of principles of natural justice.
Previous Decisions
The Deputy Commissioner, CGST and CX Division VI, Raigad Commissionerate passed the Order-in-Original on 26 October 2023 confirming the service tax demand.
Issues
Whether the Deputy Commissioner, CGST and CX Division VI, Raigad Commissionerate had territorial jurisdiction to pass the impugned order against the Petitioner, an advocate practicing in Mumbai.
Whether the impugned order was passed in violation of principles of natural justice.
Submissions/Arguments
Petitioner argued that Respondent No.1 acted without jurisdiction as her office is in Mumbai, not in Raigad, and that the order was passed without proper notice or opportunity of hearing.
Respondents argued in support of the impugned order, but the Court did not detail their submissions.
Ratio Decidendi
The Deputy Commissioner lacked territorial jurisdiction to adjudicate the service tax liability of the Petitioner, an advocate practicing in Mumbai, as her place of business is outside the Raigad Commissionerate. Additionally, the order was passed in breach of natural justice as the Petitioner was not given adequate opportunity to present her case.
Judgment Excerpts
This Petition under Article 226 of the Constitution of India assails an Order-in-Original dated 26th October, 2023 passed by the Deputy Commissioner, CGST and C. Excise, Raigad, whereby an amount of Rs.35,82,298/- towards service tax under the provisions of Section 73(1) of Finance Act, 1994 read with Section 174 of Central Goods and Service Tax Act, 2017, has been ordered to be recovered from the Petitioner inter-alia with interest and penalty.
The Petitioner has contended that she is an advocate practicing in this Court. The primary contention of the Petitioner in assailing the impugned order is to the effect that Respondent No.1 in passing the impugned order has acted in patent lack of jurisdiction, hence, interference of this Court in the present proceeding would be justified.
Procedural History
The Petitioner received an email on 5 October 2023 for a hearing on 17 October 2023. She appeared through her Chartered Accountant on that date. On 18 October 2023, she wrote a letter requesting documents and an opportunity to cross-examine. The impugned Order-in-Original was passed on 26 October 2023 without considering her request. The Petitioner then filed the present Writ Petition on an unspecified date.
Acts & Sections
- Finance Act, 1994: Section 73(1), Section 75, Section 78, Section 77(1)(c), Section 77(1)(a), Section 69, Section 70(1)
- Central Goods and Services Tax Act, 2017: Section 174
- Constitution of India: Article 226
- Service Tax Rules, 1994: Rule 7(C)
