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Tax men accuse Lakshmikumaran of ‘forum shopping’ & ‘misleading’ tribunal

Lakshmikumaran & Sridharan (LKS) has been accused by service tax authorities of forum shopping and misleading the the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) by allegedly not disclosing the existence of a live Supreme Court case for the same client on the same issues.

LKS had appealed a tax tribunal order both in the Supreme Court and the CESTAT for a software developer client, according to The Economic Times.

However, according to the service tax authorities’ complaint, LKS advocates BL Narasimhan and MP Devnath had won before the CESTAT after appearing on 2 August, but neither the firm nor the tribunal’s own its registry ever told it that the same case was also being heard by the Supreme Court, where LKS’ V Lakshmikumaran, L Charnya, Aditya Bhattacharya, Hemant Bajaj, Anand K and MP Devnath had appeared on 8 July.

The principal commission of the Service Tax Commissionerate claimed in an application to CESTAT that “Mr Narasimhan was duty-bound to inform CESTAT that the Hon’ble Supreme Court had already passed an order on 08.07.2016, which he did not”, which meant that the tribunal had no more jurisdiction to hear the application.

Therefore “it is not a legally acceptable/tolerable act of the appellant. It appears that the act was done consciously and deliberately to mislead the two judicial bodies”, according to the complaint.

LKS managing partner V Lakshmikumaran denied any wrongdoing, telling the ET via email: “I have examined the matter. Contentions raised by the service tax department are factually and legally incorrect. The matter is sub judice.”

Meanwhile, former solicitor general M Parasaran commented to the ET: “This case is much more serious than forum shopping - it is tantamount to fraud. You suppress facts from the tribunal and get a favourable order by deceit - it is fraud and contempt of court.”

Much more details and background to the charges at The Economic Times.

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