Continuation of pre-GST service tax proceedings upheld, with interim protection against enforcement of any final order.

Proceedings under Chapter V of the Finance Act, 1994 relating to the pre-GST period were not interdicted at the interim stage merely because the Goods and Services Tax Act, 2017 had come into force. The Court allowed the show cause notice and summons to remain operative and held that the underlying adjudication could continue, while granting limited interim protection by directing that any final order would not be given effect to until disposal of the writ petition. The ruling reflects the view that repeal of the service tax regime did not, by itself, bar continuation of pending pre-GST proceedings.

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Issues: Whether the impugned show cause notice and summons should be interdicted at the interim stage and whether the proceedings under Chapter V of the Finance Act, 1994 could continue after the coming into force of the Goods and Services Tax Act, 2017.

Analysis: The petition challenged the initiation of proceedings in relation to the pre-GST period on the footing that no fresh action could be taken under the repealed service tax regime. Reference was also made to prior judicial precedent recognizing the continuation of proceedings under Chapter V of the Finance Act, 1994 despite the GST regime coming into force. At the interlocutory stage, the Court did not stop the proceedings, but it considered it appropriate to protect the petitioner against immediate coercive effect of any final order.

Conclusion: The proceedings pursuant to the impugned show cause notice and summons were permitted to continue, but any final order was directed not to be given effect to until disposal of the writ petition.

Final Conclusion: Interim protection was granted only to the limited extent of keeping the final consequences of the adjudication in abeyance, while leaving the underlying proceedings to move forward.

Ratio Decidendi: At the interim stage, continuation of proceedings under the repealed service tax framework was not interdicted merely because GST had come into force, though protection could be granted against immediate enforcement of the final order.

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