The Orissa High Court has recently directed the Commissioner, GST to issue clear instructions to all officers in Odisha clarifying that no notice demanding the payment of service tax/GST should be issued to practicing advocates.
The Bench of Chief Justice Dr. S Muralidhar and Justice BP Routray was hearing a plea moved by advocate Devi Prasad Tripathy who stated that as per a notification issued in June 2012, the service tax liability of an advocate for legal services rendered is nil.
Despite this, the court observed that the Department appears to have issued notices to lawyers demanding the payment of service tax. As such, the Court has now called for the issuance directions to avoid such a course of action.
On the other hand, the Principal Commissioner, GST, and Central Excise, Bhubaneswar Commissionerate informed the court that proceedings against Tripathy had been dropped after information was received that he is a practicing advocate.
However, the Bench expressed concern over the authorities’ insistence that Tripathy give documentary evidence to prove his claim that he is a practicing lawyer for exemption from the levy of GST or service tax. The Court also took note that a similar notice was issued to Tripathy in 2017.
Soon after the above observation, other lawyers present in Court during the hearing also informed that they have received similar notices, prompting the Bench to remark, “It appears that despite knowing fully well that advocates are not liable to pay service tax or GST, notices continue to be issued to them by the GST Commissionerate.”
“The Court expresses its concern that practicing advocates should not have to face harassment on account of the Department issuing notices calling upon them to pay service tax/GST when they are exempted from doing so, and in the process also having to prove they are practicing advocates,” added the bench.
Subsequently, the court adjourned the matter for the next hearing, until April 22.
