HC granted stay on Service Tax Audit instituted post GST implementation

No Comments

In the case of M/s. Solvina India Pvt. Ltd. v. Union of India & Ors, the Hon’ble Delhi High Court in W.P.(C) 9264/2019 dated August 27, 2019, has granted a stay on the Service Tax audit proceedings instituted under Rule 5A of the Service Tax Rules, 1994 which was initiated after implementation of GST.

The court observed as under:-

“Looking into the facts and circumstances of the case and looking to the provisions in Chapter V of the Finance Act, 1994 and Rule 5A of Service Tax Rules read with Sections 6(1) and (2) of the General Clauses Act and Section 173 and 174 of the Central Goods and Services Tax Act, 2017, there is a prima facie case in favour of the petitioner. Balance of convenience is also in favour of this petitioner. Irreparable loss will be caused to the petitioner, if the stay as prayed for, is not granted. We, therefore, stay further proceedings initiated pursuant to the communication dated 20.02.2019 (Annexure P-1 to the memo of this writ petition) as well as communication dated 07.08.2019 (Annexure P-4 to the memo of this writ petition) till the disposal of this writ petition.”

HC has now listed the writ petition in the category of ‘After Notice Miscellaneous Matters’ for final disposal on January 31, 2020.