Order Date – 14 June 2023

Parties: Dev Versha Publication Private Limited and others Vs The Union of India and others

Facts –

• The Petitioner, Dev Versha Publication Private Limited and others, contented that since Chapter V of the Finance Act, 1994 was omitted on 01.07.2017, no liability towards Service Tax, under Chapter V of the Finance Act, 1994, could be fastened upon the appellants after the repeal of Chapter V of the Finance Act, 1994, even in respect of the period preceding the said repeal on 01.07.2017.
• It was further argued that only such proceedings which had been initiated prior to 01.07.2017, could be continued. However, fresh proceedings could not have been initiated-if not already initiated post 01.07.2017.

Issue – 

• Whether fresh proceedings can be initiated after 01.07.2017 under Chapter V of the Finance Act, 1994?

Order –

• The Divisional Bench of Hon’ble High Court observed that from a plain reading of Section 174(2), which, despite the repeal and amendment of the Finance Act, 1994, saved the previous operation of the amended Act or repealed Acts, and orders or anything duly done or suffered thereunder. The amendment/ repeal did not affect any right, privilege, obligation, or liability acquired, accrued or incurred under the amended Act or repealed Acts, or orders under such repealed or amended Acts.
• Section 174(2)(e) also saved and protected the right of Revenue to undertake investigation, inquiry, verification (including scrutiny and audit), assessment proceedings, adjudication and any other legal proceedings or recovery of arrears or remedy in respect of any such duty, tax, surcharge, penalty, fine, interest, right, privilege, obligation, liability, forfeiture or punishment.
• The saving clause (e) expressly permits the institution of the proceedings or remedy despite the amendment/ repeal. If the liability of the assessee survived in respect of the taxing laws in force prior to its repeal/ amendment even after such repeal/ amendment, it does not stand to reason that the machinery for fixation and realization of such liability would not be available to the State.
• Therefore, the appeal is dismissed with liberty to the appellant to avail of the statutory remedy of appeal against the adjudication order dated 30.06.2022.