Ex parte service tax adjudication remanded for fresh reply stage, with exemption and limitation defences left open.

Ex parte service tax adjudication based on income-tax material was set aside, and the matter was remitted to the stage of reply to the show-cause notice. The Court left open the petitioner's exemption, jurisdictional, negative-list, limitation, and other substantive defences for fresh consideration. It noted that similar matters had already been restored for reconsideration, including whether the services fell outside section 65B(44) of the Finance Act, 1994 and whether Notification No. 25/2012-ST applied. All merits remained unadjudicated, and the departmental authorities were directed to conduct fresh adjudication from the reply stage.

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Issues: Whether the ex parte orders-in-original and appellate order deserved to be set aside and the matter remitted to the stage of reply to the show-cause notice, with the petitioner's exemption and other contentions left open for reconsideration.

Analysis: The dispute arose from service tax adjudication based on material drawn from income-tax returns. The impugned proceedings were ex parte. The Court noted that in similar matters it had already remitted cases for fresh consideration and had directed the authorities to examine, among other things, whether the services fell outside Section 65B(44) of the Finance Act, 1994, whether they were covered by the negative list, whether any exemption applied under Notification No. 25/2012-ST, and whether limitation barred the demand. The earlier order also clarified that no contentions, including jurisdictional objections, stood adjudicated and that all merits were kept open. In that background, the impugned orders were set aside and the matter was restored to the stage of reply to the show-cause notice.

Conclusion: The impugned orders were set aside and the matter was remitted for fresh adjudication from the stage of reply to the show-cause notice, in favour of the petitioner.

Final Conclusion: The tax demand proceedings were reopened for reconsideration by the departmental authorities, and the petitioner was permitted to file a fresh reply with all substantive defences preserved.

Ratio Decidendi: Where an adjudication order is passed ex parte and the issues require reconsideration of statutory coverage, exemption, and limitation, the matter may be remitted to the stage of the show-cause reply with all contentions kept open.

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