Indian Institute Of Planning vs Commissioner Of Service Tax
2007 Latest Caselaw 628 Del

ORDER

1. In the present matter a show cause notice has been issued to the petitioners. Avowedly, the language employed in the show cause notice appears to convey that a decision has already been arrived at by the Respondents that the Petitioners are exigible to payment of service tax. Our attention has been drawn to para 10 of the Counter Affidavit which states that there is no procedure/mechanism under the Finance Act, 1994 which requires issuance of a show cause notice to a person prior to determination as to whether it is liable to payment of service tax. However, the subsequent paragraph 13 clarifies that the person to whom a show cause has been issued would have the right to make complete representation on all points including whether it is exigible to service tax. Mr. Nag, learned Counsel appearing for the Respondent, confirms that the Petitioners shall have complete liberty in making submissions to the above effect. A speaking order shall be passed on this very question prior or simultaneously with the demand being confirmed.

2. Mr. S. Ganesh, learned senior counsel appearing for the Petitioners, also expresses the grievance that the Petitioners have received show cause notices as well as summons from 7 Commissionerates across the country. He submits that the billing/accounting operations of the Petitioners are centralized at Delhi and, therefore, any information required by the Respondents would be available at Delhi. Mr. Nag, learned Counsel appearing for the Respondent, draws our attention to Section 69 of the Finance Act, 1994 which requires persons subject to the provision of Service Tax Act to register at a particular city. Show cause notices and summons have been issued from various Commissionerates for the reason that the Petitioners have not registered in a particular city in case it has a centralized billing/accounting system. In reply to these submissions, Mr. Ganesh rightly points out that the case of the Petitioners is that they are not at all exigible to the payment of service tax and hence, the Petitioners have no obligation to register at any city regardless of whether it is pursuing a centralized billing/accounting system. These questions will no doubt be addressed, adjudicated and answered at the time when the show cause notice is disposed of. If the competent authority arrives at the decision that the Petitioners are exigible to payment of service tax, the Petitioners would immediately opt whether or not to register at New Delhi on the grounds that a centralized billing/accounting system is carried out from this city. If it does not so register, the Respondents would be at liberty to revive their show cause notices/summons, if necessary, from other Commissionerates also. In these circumstances, we direct that the proceedings in the show cause notice be held at New Delhi and be decided by the competent authority at New Delhi. The Writ Petition is disposed of accordingly.