High Court · 2025

Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue a Writ or Order, Direction or any other Writ particularly one in the nature of Writ of Mandamus declaring the action of the 2nd Respondent in issuing the impugned proceedings dated 26.02.2025 (served on the petitioner on 28.O3.2025) in O.C.No.50i2025 as illegal, arbitrary, high handed, violation of principles of natural justice and contrary to the provisions of the Finance Act 1994 and hence set aside the same as null and void. lA NO: 1 OF 2025 Petition under Section 151 CPC praying that in the circumstances stated in the affidavit filed in support of the Writ petition, the High Court may be pleased to grant stay of all further proceedings pursuant to the impugned proceedings dated 26.O2.2025 (served on the petitioner on 28.03.2025) in O.C.No.50/2025 passed by the 2nd r:spondent. Counsel for the Pet tioner: SRI SIMHADRI BHARADWAJA, llEF'. SRI B.KRISHNA REDDY Counsel for the Res pondent No.1: DEPUTY SOLICITOR GENEIIIAL OF INDIA Counsel for the Respondent No.2: SMT BOKARO SAPNA REDDY, Sr. SC FOR lT The Court made the following: ORDER TfIE HON'BLE THE CHIEF JUS'TICE SRI APARESTI KUI\IAR SINGII ,\r\I) I'IIE HON'BLE SI{I JUSTICT] C.}I.}IOHILDD[\ WRI'I PE'II'IION No. 1{702 of 2025 ()RI)I.,R: Sri Sirnhadri Bharadw'aja, leanled counsel at)pears tbr Sri B. Krislura Reddy, Iearned counscl lbr petitioner. Srnt. Bokaro Sapna Reddy. learned Seuior Standing Counsel fbr lncome-tax appears for rcspondents.

2. Petitioner assails the irnpugned proceedings datc-ci

26.02.2025, furnexure P.1, issued by the Superintendent o[' Central Tax, Himayatnagar, Hyderabad, respondent No.2, in O.C.No.50 of 2025, for recovery of arrears of revenue. on the ground that before issuance of the demand, no Order-ln- Original or any anterior show cause notice lvas sen,ed upon the pctitioner.

3. The petitioner referred to Section 37C of the Central E.xcise Act, 1944 (for shoft 'the Act, 1944'), relating to rnodc of service of decisions, orders which applies to thc proceedings under Service Tax in terms of Section 83 of the Finance Act, 1994. 2

4. ('oLinter-affidavit rvas filed by the respondents I 1.08.1(tl:; No re.ioinder affidai'it thereto has bc'en t'iled -5. Ilcspondcnts in their co unter-aftida v it have made ;atr:lrorical clenial to the contentions of the lretitioners, at paragraph l!os. 15, l6 and 19, rvhich read as under: -'li. [t is respectfully submitted that accordingly the Drpartnlent has issued Show Cause Notice No. C. No. I\' '9l 10,!/2021-Third Party 10111056YN000016531C 18.10.2021 demanding th; service tax ol Rs.14,56,875,,- linclusive of CESS) undcr Scrrion 73(l). The Show Cause Notice was emailcd to pet tioner on 20.10.2021. 'l'he tax demanded in the shorv DIIr : eause notic. was contirmed by the adjudicating authoritl' i'irl : OIO No.278i2023-24-ST dated 30.09.2023. r 6. [t is respecthlly submitted that the Respondenl No. L has issucd letter OC.No.50i2025 having DIN: l0l i()156YN0000501599 dated 26.02.2025 for recoverl of tax ducs confirmed in the adjudication order after c,)nrnlctron ot'lhe tiine liinit to file an appcal before the appc'llate authorities for payment of tax dues- The letter was rL'cc \ ed by the petitioner on 28.02.2025. It is respectfufiy submitted that the assefiion

19. rnadr: in respect of para 4, 5 and 6 of the Writ Petition, it is subnLittcd that the contention ofthe petitioner that no Order in Original No.27812023-24-5. Tax dated 30.09.2023 or any .urterior show cause notice has been served on the peliti;ncr is not acceptable as rnuch as the Show Cause Noticc datcd 18.10.2021 ll'as served via Speed Post 3 No.EN43895ll04N on 20.10.2021 and also sent to their registered e-mail [D "manojbang@me,com" on

20. 10.2021. .Ihe said Shorv Cause Notice rvas not retumed. Further, the petitioner u,as given tkec opportunities ol personal hearing on 12.09 -2023, 20.09.2021 and 27.09-2023. for whi:h Personal Hearing Notices ryerc dispatched tlrrough spced post on 06-09.?021. .18.09.2021 and 26.09.1021 respectively. Horvevcr, tht: postal authorities hale retumed the said letters lvith a relnark "No such person in this address". Accordingly, adjudication proceedings u ere completed prior to the receipt of the said recovery of tax dues letter dated 26.02.2025 by tlte pctitioncr and C)rder ln Original No.278/2023-24-ST ivas issued on 30.09.2023. The petitioner have not attendcd the -fhc pcrsonal hearings on the dates mentioned above. subject Onier in Original was passed ex-parte after observing the principles of natural justice and aftcr giving them sufficient time i,e., 2 years from the date of Sho"v Cause Notice. The said Order in Original was served to the petitioner via Speed Post No.8N438898629IN on

30.10.2023 to the registered address as per Section 37C ot' the Central Excise Act, 1944. However, the postal authorities had retumed the said order with a remark "No such person in this address" and therefore it is understood that the petilioner had vacated their Principal place of business without intimation to the Department. The said Order in Original was also sent to their registered e-mail [D ''[email protected]" on 16.05.2024. Subsequently. after lollorving the due procedures, action for recovery of arears was initiated against the petitioner and a letter dated

26.02.2025 was sent to the petitioner for the same. Hence. their contention that recovery proceedings have been issued without communicating the connected orders refered to in the said proceedings and the action of the respondent is against the established principles of natural justice and are 4 ,rolati\e of ,.\nicle l4 oi (irnstitution ol' hrdi:- is rn)t ii iccptilble '

6. Lcal'rcd courlsel fbr the respondents submits that the show cause noticc was fbllorvcd by tliree opportunities of personal l earing notices r.vhich were dispatched to the registercd rddress ol the petitioncr and retunred with the remark tira no such person available in the adctress. The Order-ln-Original was also sent to the registered enrail [D of tlre petiticrr er on 16.05.2024. Thereafter. fbllorving due procedure. rrction of recovery of arrears of revernue was initiated by the impugned proceedings dated 26.02.2025. 'Iherefbrc, thc contention of the petitioner that without communicati lg tho connected orders or seryice o1- notice, the impugned pl',)ceedings has been issued straight away is not tenable. Thert' is no violation of principles of natural justice as the procedure lor serving notices/orders under Section 37C of the Act, 19.14. has becn duly tbllowed. She has pointed out that againsl the impugned proceedings, the petitioner had earlier pref-err,)d Writ Petition No.12347 of 2025 which was rvithdraun rvi.h liberty to the petitioner to file a properly \ 5 I constituted petition as the important pleadings were not made therein. 'l'hc same lacunae renain in the present writ alfidavit also which lrave been specifically controvefted on t-acts by the rcspondents. l'herc'lbre, sl.re has prayed that the instant Writ Petition nral' be dismissed. 1 . l,earned counsel lbr thc pe titioner has sought tirne to fl lc rejoinder aflldavit. Flowever,, since the counter-affidavit ll as lllccl on I 1.08.2025 itself rvith service to the otl-rer side. we do not dccm it proper to grant lurlher adjourn.nent on that counl i )

8. l{aving heard the learned counsel for the partics and in vieu' of cor.rspicuous denial of allegations of fact by the respondents, we are of the view that the very ground on whicl.r the writ proceedings were initiated has n,r legs to stand. 'Ihe pctitionel had failed to participate in the proceedings in lespcct ol'r,r hich show causc notice and pe rsonal hearing notices wL-rc issued tlrrough specd post as per Section 37C ofthe Aat, 1944, and the Order-ln-Original was also sent to the registered entail II) ol the petitioncr. The petitioner diri not take any step pursuant therelo and straiglit:rway approached this Court alicr 6 IICJ L$irS. J) & (iMM..l tl' I' \o.14702 of 2025 .f' issuance of the irnprrgned proceedings fbr rccovery of arrears of reveuuc on the aforesaid grounds which for thc aforesaid rcasons cann ()t bc- cntertaincd Accuri irrglv, thc instant Writ Petition i:; c isrnissed. There shall b: no order as to costs. Misccllancous applications, il- an1, pending. shall stand c loscd. 1 \ To, //TRUE COPY' SD,'- L. VIJAYA LAXMI II;TAI,IT REGISTRAR [iECTION OFFICER '1 . One CC to SRI tS KRISHNA REDDY Advocate [O 2. One CC to SN/T BOKARO SAPNA REDDY, Sr. SC FOR lT [ODUC] 3. One CC to DEFUTY SOLICITOR GENERIAL OF lNDlA, Hich Court for the State of Telangana at Hyderabad [OPUC]

4. Two CD Copies BSR LS Y l- HIGH COURI' DATED:1 311c12025 ORDER WP.No.14702 ot 2025 ( 1HE :S 14 '(j J,J I' 10 iltt/ 2U[ (: C, Sr,AT(.r'Er DISMISSING THE WRIT PETITION, WITHOUT COSiTS (e\ (r 3t \0 )