By TIOL News Service

CHENNAI, MAR 28, 2016: THE petitioner Company is engaged in generation of 105.66 MW electricity in the power plant of M/s Samalpatti Power Company Private Limited. During the month of March 2014, a demand letter dated 28.03.2014 was issued by the Assistant Commissioner of Service Tax, requiring the petitioner to deposit Service Tax for the period from January to March 2014 on the activity of generation of electricity.

The petitioner challenged the demand letter dated 28.03.2014 by way of a Writ Petition in High Court. When the writ petition came up for hearing, the Court disposed of the writ petition, directing the petitioner to treat the demand letter as Show Cause Notice and file its reply within a period of three weeks from the date of receipt of copy of that order. The Court further directed the Assistant Commissioner to pass appropriate orders after considering the reply, filed by the petitioner and after granting an opportunity of personal hearing.

The Petitioner accordingly, filed a reply and was waiting for hearing. However, the Assistant Commissioner filed a miscellaneous petition before the High Court for modification of the earlier order and even without waiting for orders of the court, the 1st respondent (Commissioner of Service Tax), simultaneously, issued the impugned show cause notice with entirely different allegations, which is again challenged by the Petitioner.

After hearing both sides, the High Court held:

++ When the respondent is bound by the directions given by this Court and when this Court had directed the petitioner to submit their objections by treating the impugned proceedings as show cause notice and when this Court directed the respondent to consider the same and pass orders in accordance with law, after giving an opportunity of personal hearing to the petitioner Company, the issuance of the 2nd show cause notice, contrary to the direction of this Court in W.P.No.9496 of 2014 is liable to be set aside.

++ The respondent cannot violate the orders of this court on the guise of filing an application for modification. If the respondents are really aggrieved over the order passed by this Court in the earlier Writ Petition in W.P.No.9496 of 2014, they should have filed modification petition at the earliest point of time. As already stated, even the modification petition has not yet been numbered and brought before the Court for hearing.

++ Since the issuance of the 2nd show cause notice dated 12.10.2015 is contrary to the order passed by this Court in W.P.No.9496 of 2015, the same is set aside and the writ petition stands allowed.

(See 2016-TIOL-596-HC-MAD-ST)