Facts of the Case

This is a writ petition before the High Court for the State of Telangana at Hyderabad challenging an Order-in-Original passed under the erstwhile service tax regime (Finance Act, 1994). This is a Service Tax matter, not a GST dispute — although the respondent authorities happened to be officers of the CGST Commissionerate (service tax being administered by the same department that now administers GST), the impugned order and the exemption relied upon both relate to service tax law prior to the GST regime.

The petitioner, Tadishetty Aditya, an advocate by profession, challenged Order-in-Original No. 45/2023-24-S.Tax dated 24.07.2023 passed by the Assistant Commissioner of Central Tax, Himayatnagar GST Division, Hyderabad. The petitioner's case was that, being a lawyer by profession, he was exempted from payment of service tax under Notification No. 25/2012 dated 20.06.2012. He relied on a Division Bench judgment of the same High Court in W.P. No. 8967 of 2023, decided on 16.06.2023, where under similar facts the impugned order had been set aside and the matter remanded to the assessing authority for fresh consideration in light of the same notification. The Department's counsel conceded that the facts of the present case were similar to those in W.P. No. 8967 of 2023.

Issues Involved

  1. Whether the service tax demand raised against the petitioner-advocate, without regard to the exemption available under Notification No. 25/2012, was sustainable.
  2. Whether the matter ought to be remanded to the assessing authority for fresh consideration in light of the notification and the petitioner's professional income, consistent with the earlier co-ordinate Bench ruling in W.P. No. 8967 of 2023.

Petitioner's Arguments

  • As a practising advocate, the petitioner was exempted from payment of service tax under Notification No. 25/2012 dated 20.06.2012.
  • An identical issue had already been decided by a Division Bench of the same High Court in W.P. No. 8967 of 2023, where the impugned order was set aside and the matter remanded for fresh consideration in terms of the same notification.

Respondent's Arguments

  • The Department's counsel accepted that the facts of the present case were similar to those already decided in W.P. No. 8967 of 2023 dated 16.06.2023.

Court Order / Findings

  • Taking into account Notification No. 25/2012 and the concession made by the Department that the facts mirrored the earlier decided case, the Court set aside/quashed the impugned Order-in-Original dated 24.07.2023.
  • The matter was remanded to the respondent authority for fresh consideration, subject to the petitioner furnishing all relevant materials establishing that he relies exclusively on income from his legal profession.
  • The petitioner was directed to enter appearance before the Assistant Commissioner on or before 19.10.2023, without the need for any fresh notice, and to place his submissions on record at that stage.
  • The writ petition was accordingly allowed, with no order as to costs, and pending miscellaneous applications, if any, were closed.

Important Clarification

This order does not lay down any new legal proposition — it simply applies an existing co-ordinate Bench ruling on the same notification to a similarly-placed advocate, quashing the service tax order and sending the matter back for a fresh, notification-compliant assessment. It confirms that professionals covered by Notification No. 25/2012 are entitled to have their exemption claim properly examined by the assessing authority rather than the demand being confirmed without regard to it; it does not concern or decide any question of GST law.

Sections Involved

  • Finance Act, 1994 — Service tax provisions (Chapter V)
  • Notification No. 25/2012-Service Tax, dated 20.06.2012 — Mega exemption notification
  • Article 226, Constitution of India — Writ jurisdiction

Decision – In Favour of Petitioner (Assessee)

The Telangana High Court allowed the writ petition, setting aside the impugned service tax order and remanding the matter for fresh consideration in light of the exemption notification, without deciding the exemption claim on merits itself.

Case Details

  • Court: High Court for the State of Telangana at Hyderabad
  • Case No.: Writ Petition No. 25865 of 2023
  • Coram: Hon'ble Sri Justice P. Sam Koshy and Hon'ble Sri Justice Laxmi Narayana Alishetty
  • Date of Order: 19 September 2023

Link to Download the Order

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