Taxpayer Granted Right to Challenge Service Tax Demand Order with Merit-Based Review Within 30-Day Window

The HC examined a service tax demand case involving penalties and interest under the Finance Act, 1994. After considering arguments, the court granted the petitioner liberty to challenge the order before the Appellate Commissioner within 30 days, directing merit-based review without limitation constraints. The writ petition was disposed of, with the vehicle's release subject to confiscation proceedings' final outcome.

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Issues:
The judgment involves a challenge to an Order in Original regarding service tax demand, interest, and penalties u/s various sections of the Finance Act, 1994. The main issue is the challenge to the impugned order and the subsequent appeal process.

Service Tax Demand and Penalties:
The respondent confirmed a demand of Rs. 3,92,229/- from the petitioner for service tax allegedly due for the period between April 2016 and June 2017 u/s proviso to Section 73(1) of the Finance Act, 1994. Additionally, interest u/s Section 75 and penalties u/s Section 78(1), Section 77(1)(c), and Section 77(2) of the Finance Act, 1994 were imposed on the petitioner. The impugned order specified the amounts and penalties to be paid within a specified time frame.

Appeal and Time Limit:
The petitioner, after the order, submitted papers to a Chartered Accountant who failed to file an appeal in time. The petitioner paid the disputed tax on a specific date, excluding penalties and interest. The respondent argued that the writ petition was not maintainable beyond the statutory appeal period, citing a Supreme Court decision. The respondent contended that the appeal should have been filed within the statutory time frame, and as the writ petition was filed beyond 120 days, it should be dismissed.

Judgment and Disposal:
The Court considered arguments from both sides and noted that the petitioner had paid the disputed tax. The Court granted liberty to the petitioner to challenge the impugned order before the Appellate Commissioner within 30 days from the date of receipt of the order. The Appellate Commissioner was directed to decide the appeal on merits without reference to the limitation. The release of the vehicle was made subject to the final outcome of confiscation proceedings. The Writ Petition was disposed of with no costs, and connected Miscellaneous Petitions were closed.

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