MUNDESHWARI CONSTRUCTION V. ADDL.COMMISSIONER OF CENTRAL E

CWJC/18792/2010

AI Insights

The case involves Mundeshwari Construction, a partnership firm, which challenged a show cause notice issued by the Additional Commissioner of Central Excise and Service Tax, Patna, regarding service tax on construction services provided to the National Thermal Power Corporation. The original demand for service tax was set aside by the appellate authority, but the assessing authority issued a new show cause notice for the same construction, claiming it was residential construction. The petitioner argued that the assessing authority had no power to review or re-initiate the assessment process after the appellate authority's decision. The respondents contended that the new notice was not a review but a fresh initiation based on a different classification of the construction.

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 726345 (HC-PATNA)
• Appeal Type: Others
• Pronouncement Date: 12-08-2011
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income Tax, Delhi v. Kelvinator of India Limited, Kalabharati Advertising v. Hemant Vimalnath Narichania
• Laws Referred To: Article 226 of the Constitution, Finance Act, 1994
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: ARCHANA MEENAKSHEE; ARCHANA SINHA
• Assessee Lawyers: D V PATHY; ABHI SARKAR
• Keywords: Construction of Residential Complex; Rectification of mistake; Review of order; Service tax; Show cause notice
• Section: 74

Judgement Text

" IN THE HIGH COURT OF JUDICATURE AT PATNA Civil Writ Jurisdiction Case No.18792 of 2010 ====================================================== 1. Mundeshwari Construction, a partnership firm having its office at Laxman Bigha, P.S.- Aurangabad, Distt.- Aurangabad (Bihar) through its partner, Shri Gopal Sharan Singh S/O Sri Ram Raj Singh R/O Laxman Bigha (behind Anugrah Middle School), P.O. and P.S.- Aurangabad, Distt.- Aurangabad (Bihar) .... .... Petitioner Versus 1. Additional Commissioner of Central Excise and Service Tax (Hqrs.), Patna having its Office at Central Revenue Building Annexe, Birchand Patel Marg, Patna 2. Assistant Commissioner, Central Excise Division, Gaya 3. Superintendent (Adjn.) Central Excise (Hqrs.), having its office at Central Revenue Building Annexe, Birchand Patel Marg, Patna .... .... Respondent/s ====================================================== Appearance : For the Petitioner : Mr. D.V.Pathy, Advocate with Mr. Abhi Sarkar, Advocate For the Respondents : Mrs. Archana Meenakshee, Sr. S.C. with Mrs. Archana Sinha, Jr. S.C. ====================================================== CORAM: HONOURABLE THE CHIEF JUSTICE and HONOURABLE MR. JUSTICE BIRENDRA PRASAD VERMA ORAL ORDER (Per: HONOURABLE THE CHIEF JUSTICE) 14. 12.08.2011 This Petition under Article 226 of the Constitution is filed by the assessee against the show cause notice dated 26th Patna High Court CWJC No.18792 of 2010 (14) dt.12-08-2011 2 / 4 2 August 2010 issued by the Assessing Officer-cum-Additional Commissioner of Central Excise and Service Tax (Hqrs.), Patna in respect of service-tax payable on the construction of residential complex made by the assessee-writ petitioner on behalf of the National Thermal Power Corporation. Learned advocate Mr. D.V. Pathy has appeared for the petitioner. He has submitted that the construction in question was earlier examined by the assessing officer and a demand-cum-show cause notice was issued on 14th September 2007. Pursuant to the said demand-cum-show cause notice under order dated 29th January 2009, the respondents raised a demand of service tax amounting to Rs.6,35,755.00 and education cess of Rs. 12,714.00. The said order was challenged by the petitioner before the Commissioner of Appeals. The appellate authority by his order dated 30th June 2010 allowed the appeal and set aside the order of the assessing officer. We are informed at the Bar that the order of the appellate authority was not challenged further and has become final. Since the order of the appellate authority, the assessing authority has issued the impugned demand-cum-show cause notice in respect of the same construction made by the writ petitioner. Therefore, the present Petition. Learned advocate Mr. Pathy has submitted that the Act does not make any provision for review of the order. The order made by the assessing authority in respect of the construction in question having been set aside by the appellate authority, the assessing authority has no authority to review his own order in the garb of a fresh show cause notice. Mr. Pathy, in support of his submission, has relied upon the judgments of the Hon’ble Supreme Patna High Court CWJC No.18792 of 2010 (14) dt.12-08-2011 3 / 4 3 Court in the matters of Commissioner of Income Tax, Delhi v. Kelvinator of India Limited, [(2010) 2 SCC 723] and of Kalabharati Advertising v. Hemant Vimalnath Narichania, [(2010) 9 SCC 437]. The petition is contested by the learned advocate Mrs. Archana Meenakshee. She has submitted that Section 74 of the Finance Act, 1994 empowers the assessing officer to rectify any mistake apparent from the record. She has also submitted that the impugned demand-cum-show cause notice cannot be said to be the review of the earlier order, it is a process initiated afresh. Earlier the process was initiated under the presumption that the construction in question was commercial or industrial construction. Now it has been initiated as it is held to be the residential construction. We are afraid, once the assessment was made, the assessee succeeded in the proceeding before the appellate authority the order of the assessing authority merged into the order of the appellate authority. The question of rectification of a mistake or review thereafter would not arise. Nor the Assessing Officer has authority to initiate the assessment process afresh. Learned advocate Mrs. Meenakshee has not been able to show that the assessing authority had power to initiate the process afresh in respect of the same construction. In our view, the order of the assessing authority having been set aside by the appellate authority, the assessing authority could not have started the proceeding de novo in the same subject matter. For the aforesaid reason, the Petition is allowed. The impugned demand-cum-show cause notice dated 26th August 2010 Patna High Court CWJC No.18792 of 2010 (14) dt.12-08-2011 4 / 4 4 is quashed and set aside. Parties will bear their own cost. Pawan Kumar/- (R.M. Doshit, CJ) (Birendra Prasad Verma, J) "