Court sets aside show cause notice, emphasizes natural justice principles

The High Court partially allowed the Petition, setting aside the order confirming one show cause notice and directing a fresh disposal, while allowing the Petitioner to challenge the other notice before the Tribunal. The Court emphasized the importance of adhering to principles of natural justice and providing a fair opportunity for personal hearing in such matters.

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Issues:
1. Challenge to order passed by Commissioner of CGST on service tax liability.
2. Petitioner's contention of breach of natural justice in confirming show cause notices.
3. Availability of alternative remedy of appeal to Customs Excise and Service Tax Appellate Tribunal.
4. Consideration of submissions and grievances by the High Court.

Issue 1: Challenge to order passed by Commissioner of CGST on service tax liability
The High Court was approached under Article 226 challenging the order passed by the Commissioner of CGST confirming the liability to pay service tax on Reverse Charge Mechanism on import of services. The impugned order dated 29th June, 2018 disposed of two show cause notices and confirmed the liability, leading to the Petitioner's challenge.

Issue 2: Petitioner's contention of breach of natural justice in confirming show cause notices
The Petitioner contended that the order confirming the show cause notices breached the principle of natural justice. The Petitioner's submissions in response to the show cause notices were allegedly not appropriately considered by the impugned order. Additionally, the Petitioner argued that no personal hearing was granted regarding one of the show cause notices, which was deemed as a breach of natural justice.

Issue 3: Availability of alternative remedy of appeal to Customs Excise and Service Tax Appellate Tribunal
The Additional Solicitor General argued that the Petition should not be entertained as there was an alternative remedy of appeal available to the Customs Excise and Service Tax Appellate Tribunal from the impugned order. However, the Petitioner argued that the impugned order confirming the show cause notices was flawed and warranted the High Court's intervention under Article 226.

Issue 4: Consideration of submissions and grievances by the High Court
The High Court examined the impugned order and found that while one show cause notice did not require a personal hearing, the other notice dated 9th April, 2018 did. The Petitioner had specifically requested a personal hearing for the latter notice, which was not granted. The Court determined that the impugned order confirming the show cause notice dated 9th April, 2018 was bad in law due to the lack of a personal hearing. Consequently, the High Court set aside the order and directed a fresh disposal of the notice with a personal hearing and adherence to principles of natural justice. The Court also allowed the Petitioner to challenge the order confirming the other show cause notice before the Tribunal.

In conclusion, the High Court partially allowed the Petition, setting aside the order confirming one show cause notice and directing a fresh disposal, while allowing the Petitioner to challenge the other notice before the Tribunal. The Court emphasized the importance of adhering to principles of natural justice and providing a fair opportunity for personal hearing in such matters.

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