The Bombay high court on Friday questioned the service tax department’s seriousness in recovering its dues running into crores of rupees and bringing the guilty to the book while hearing its plea to get back the money from industrialist Vijay Mallya and others.
Justice CV Bhadang also criticised the department for failing to serve two previous high court notices to Mallya and five other accused in the case on time.
In September and December 2015, the high court had issued the notices summoning them and seeking their response to the Service Tax Department’s charges. However, the notices were served to them only in February this year, just a month before Mallya left India for London.
“The notices were issued in September and December last year. If the service tax department was so serious about recovering its dues and bringing the guilty to book, why did it not serve all parties immediately? And why did it wait till March 2 to approach HC again?” Justice Bhadang asked.
The court adjourned the hearing till March 28.
Justice Bhadang was hearing an application filed by the service tax department which was seeking that a previous order of the chief metropolitan magistrate (CMM) that granted Mallya bail in the case of service tax default be quashed. The department has been fighting the case in the HC against Mallya and his now defunct Kingfisher airlines since 2015.
According to its plea, Mallya defaulted on paying a service tax of Rs. 33 crore between 2008 and 2012. The department also alleges that Mallya owns the Centre over Rs. 500 crore as “disputed” service tax.
Following the plea, the high court issued two notices to Mallya and five others. It was later brought to the HC’s attention that they had not been served the notices.
After Mallya left India for London earlier this month, the department moved a fresh miscellaneous application seeking an expedited hearing to quash the CMM’s previous order.
In 2011, the service tax commissioner had filed a case of fraud and cheating against Mallya alleging that he had defaulted on payment of Rs. 33 crore as service tax dues to the centre. In February 2015, however, the CMM held that the offence was bailable and granted Mallya and five others bail.