The Allahabad High Court ruled and directed the GST Commissioner, ordering them to provide clear instructions to the Lucknow GST Commissionerate. These instructions state that attorneys who provide legal services listed on the service tax negative list should not receive any notices regarding the payment of service tax or GST.
The directive was given during the hearing of a writ petition filed by attorney Pankaj Khare, who challenged an order issued in May 2023 by the Deputy Commissioner, CGST & Central Excise Division, Lucknow 1. The order assessed Khare for service tax and imposed taxes and interest amounting to over Rs. 33 lakhs. The bench, consisting of Justice Alok Mathur and Justice Jyotsna Sharma, issued the directive in response to Khare’s petition.
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Representing Khare, his attorney, YC Srivastava, argued that as an active attorney, thus Khare is exempted from paying service tax.
He referred to a notification from June 20, 2012, which specifically exempts individual advocates from paying service tax for services rendered to corporate entities located within the taxable territory.
The respondent’s attorney presented an additional order dated June 6, 2023, which indicated that the respondents had withdrawn their legal actions against the petitioner.
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However, during the hearing, several members of the bar informed the court that similar notices had been sent to several members of the bar. In light of this information, the court expressed concern and made the following observation:
“Practising advocates should not have to face harassment on account of the department issuing notices and calling upon them to pay service tax/GST when they are exempted from doing so and in the process also calling them to prove that they are practising advocates”.
Consequently, the High Court instructed the GST Commissioner to provide specific instructions to the Lucknow GST Commissionerate, emphasising that no notices regarding the payment of service tax or GST should be issued to attorneys providing legal services listed on the negative list for service tax. As a result of this directive, the petition was dismissed.
| Case Title | Pankaj Khare vs. Union Of India |
| Citation | WRIT TAX No. – 148 of 2023 |
| Date | 07.06.2023 |
| Counsel for Petitioner | Yogesh Chandra Srivastava |
| Counsel for Respondent | Dipak Seth |
| Allahabad High Court | Read Order |
