Court Upholds Service Tax Demand, Shifts Burden of Proof

The Court upheld the Order-in-Original confirming a service tax demand, rejecting the petitioner's claim of non-service. Despite lack of acknowledgment, the Court found compliance with Section 37C through proof of delivery via speed post. Emphasizing the petitioner's active involvement in proceedings, the Court dismissed the petition, shifting the burden of proof to the petitioner to demonstrate non-receipt despite delivery confirmation. The Court's decision was based on Section 27 of the General Clauses Act, deeming service by post completed upon proper addressing and posting.

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Issues: Challenge to Order-in-Original for service tax demand, Service of Order-in-Original, Compliance with Section 37C of Central Excise Act, Burden of proof on service of Order-in-Original.

Analysis:
The petitioner challenged an Order-in-Original confirming a service tax demand of Rs. 20,41,386 for a works contract in 2010-11. The petitioner claimed ignorance of the order until a garnishee notice was served on the bank, alleging non-service of the Order-in-Original. The Court directed proof of service, which showed the Order was sent via speed post and delivered to the petitioner's address. The petitioner argued that without an acknowledgment, Section 37C of the Central Excise Act wasn't complied with.

The Court disagreed with the petitioner, noting the petitioner's active participation in proceedings before the Additional Commissioner, including attending a personal hearing and submitting written arguments. The Court found it implausible that the petitioner, who participated in the hearing, was unaware of the subsequent Order-in-Original. Reference was made to a previous case where a similar contention was rejected, emphasizing that Section 37C's reach couldn't demand an acknowledgment card for service completion.

The Court cited Section 27 of the General Clauses Act, stating service by post is deemed completed upon proper addressing, prepayment, and posting. By producing the online tracking system printout, the Revenue proved compliance with Section 27, satisfying Section 37C requirements. The Court held that the petitioner was not ignorant of the order, dismissing the writ petition. The burden of proof shifted to the petitioner to show non-receipt despite delivery confirmation, leading to the dismissal of the petition.

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