Service tax recovery cannot rest on a recorded statement alone without completed adjudication under the statutory scheme.

Service tax recovery could not be enforced merely on the basis of an admission statement where the matter was still under investigation and no assessment or adjudication order had been passed under the Finance Act, 1994. In the absence of a completed statutory adjudication, the taxpayer could not be compelled to pay on the strength of the recorded statement alone. The Department remained free to proceed in accordance with law, issue notice, and complete adjudication before seeking recovery if tax was found due.

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Issues: Whether the petitioner could be compelled to pay service tax on the basis of an admission statement without a formal adjudication under the Finance Act, 1994.

Analysis: The matter was still under investigation and no assessment or adjudication order had yet been passed. In the absence of a completed assessment under the statutory scheme, recovery could not be enforced merely on the basis of the recorded statement. The Department was left at liberty to proceed in accordance with law, issue notice, and complete adjudication if tax was found due.

Conclusion: The petitioner could not be forced to pay the amount merely on the basis of the statement recorded, and any recovery had to await proper adjudication.

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