Sri S.G. Manjunath V. The Assistant Commissioner of Central Excise and Service Tax Davangere Division and The Superintendent of Service Tax Davangere Service Tax Range

WA/6805/2017

AI Insights

The case involves Sri S.G. Manjunath, the appellant, who contested the demand of service tax, interest, and penalty imposed by the Assistant Commissioner of Central Excise and Service Tax, Davanagere Division, for the period from April 2013 to March 2015. The appellant argued that services provided to the government, specifically water supply to BESCOM, were exempt from service tax under Clause-12 of the Notification dated 20.06.2012. The learned Single Judge had previously dismissed the writ petitions, directing the appellant to pursue the statutory appeal available under Section 85 of the Finance Act, 1994, and provided that the appeal would be considered without objection to limitation if filed within 30 days.

• Counselvise Citation: [2018] 140 COUNSELVISE.COM (IT) 799070 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 12-03-2018
• Assessment Year: misc
• Other Referred Cases: STANDARD CHARTERED FINANCE LTD. vs. COMMISSIONER OF INCOME TAX AND ANOTHER: (2016) 381 ITR 453 (SC)
• Laws Referred To: Finance Act, 1994
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: VIKRAM HUILGOL
• Assessee Lawyers: ABBIGERI; SHANTA VEERANNA K ABBIGERI
• Keywords: Jurisdictional Error; Natural Justice; Re-assessment notice; Service tax exemption; Statutory Appeal
• Section: 85

Judgement Text

" - 1 - IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 12TH DAY OF MARCH, 2018 PRESENT HON’BLE MR.JUSTICE DINESH MAHESHWARI, CHIEF JUSTICE AND HON’BLE MR.JUSTICE B M SHYAM PRASAD WRIT APPEAL NOs.6805-6807 OF 2017 (T-RES) BETWEEN: SRI S.G.MANJUNATH S/O SHIVARUDRAPPA AGED ABOUT 47 YEARS NO.151, BHANUVALLI (ASALIGRAMA) HARIHAR TALUK, PIN CODE : 577 516. DAVANAGERE DISTRICT. ... APPELLANT (BY SRI ABBIGERI KALLESHAPPA, ADVOCATE AND SRI SHANTA VEERANNA K. ABBIGERI, ADVOCATE) AND: 1. THE ASSISTANT COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX DAVANGERE DIVISION C.R.BUILDING, DEVRAJ URS LAYOUT DAVANGERE – 577 006. - 2 - 2. THE SUPERINTENDENT OF SERVICE TAX DAVANGERE SERVICE TAX RANGE C.R.BUILDING, ‘C’ BLOCK DEVARAJ URS LAYOUT DAVANGERE – 577 006. ... RESPONDENTS (BY SRI VIKRAM HUILGOL, SENIOR CENTRAL GOVERNMENT STANDING COUNSEL --- THESE WRIT APPEALS ARE FILED UNDER SECTION 4 OF THE HIGH COURT ACT, PRAYING TO SET ASIDE THE IMPUGNED ORDER DATED 13.11.2017 PASSED IN WRIT PETITION BEARING NOS.27349-27351/2016 (T-RES) AND ETC. THESE APPEALS COMING ON FOR PRELIMINARY HEARING THIS DAY, THE CHIEF JUSTICE, DELIVERED THE FOLLOWING: JUDGMENT Shri Vikram Huilgol, learned Senior Central Government Standing Counsel, appears for the respondents. Having heard learned counsel for the petitioner/appellant and having perused the material placed on record, we are not persuaded to entertain the matter in appeal. - 3 - Relevant background aspects of the matter are that, being aggrieved by the order passed by the Assistant Commissioner of Central Excise and Service Tax, Davanagere Division, Davanagere, denying exemption of payment of service tax and raising a demand of service tax of `2,26,323/- (rupees two lakh twenty six thousand three hundred and twenty three) for the period from April 2013 to March 2015 and also interest and penalty thereupon, the petitioner/appellant preferred Writ Petition Nos.27349-27351/2016 in this Court. It was contended that the services provided to the Government were exempted from demand of service tax; and since the petitioner/appellant had carried out the work of water supply to the respondent – BESCOM, a public sector undertaking, he was exempted from payment of service tax as per Clause-12 of the Notification dated 20.06.2012. The submissions so made on behalf of the petitioner/appellant were countered on behalf of the Revenue. However, the learned Single Judge found that the matter involved mixed questions of facts and law, which deserve to be - 4 - determined in the appellate forum. The learned Single Judge pointed out that, admittedly, the appeal against the order in question could be filed before the Commissioner of Central Excise (Appeals) under Section 85 of the Finance Act, 1994. Hence, and after finding no case of jurisdictional error or breach of principles of natural justice, the learned Single Judge declined to exercise writ jurisdiction in the matter with reference to the efficacious and alternative remedy of statutory appeal. In the interest of justice, even while dismissing the writ petitions, the learned Single Judge provided that if such appeal was filed within a period of 30 days from the date of order, the Appellate Authority would consider the same in accordance with law without raising any objection about limitation. Seeking to challenge the order aforesaid, learned counsel for the petitioner/appellant has strenuously argued that the impugned re-assessment notice had been issued by the respondents without authority of law. It is also submitted that the demand was sought to be raised by two different Officers in a - 5 - wholly illegal manner while causing serious prejudice to the appellant. Learned counsel has particularly referred to the decision of the Hon’ble Supreme Court in the case of STANDARD CHARTERED FINANCE LTD. vs. COMMISSIONER OF INCOME TAX AND ANOTHER: (2016) 381 ITR 453 (SC). Learned counsel submits that in view of the law declared by the Supreme Court, there was no question of re-assessment as no assessment had been carried out in the first instance. Having examined the matter in its totality, we are unable to find any case for interference in appeal. This is for the simple reason that the learned Single Judge has not entered into the merits of the case but, having regard to the questions sought to be raised and after finding that the matter involved mixed questions of facts and law; and that a statutory remedy of appeal was available, the learned Single Judge only relegated the petitioner/appellant to such remedy of appeal and even provided - 6 - for merit consideration of the appeal, if filed within 30 days irrespective of the question of limitation. It remains trite that the writ jurisdiction is essentially that of discretion and such exercise of jurisdiction can be declined for valid reasons, including the one of availability of efficacious and alternative remedy of statutory appeal. In the given set of facts and circumstances, when the learned Single Judge has not found the present one to be a fit case for exercise of writ jurisdiction, we are unable to find any such error or infirmity in the order impugned which may call for interference in appeal. Accordingly, these appeals are required to be dismissed. On being queried if the petitioner/appellant has preferred an appeal, learned counsel responded in the negative. Having regard to the circumstances, it is considered appropriate and hence, provided that, if so desired, the appellant may prefer such an appeal within 30 days from today; and if any such appeal is filed within 30 days from today, the same may be - 7 - examined by the Appellate Authority on its merits, while ignoring the question of limitation. Subject to the observations foregoing, these appeals stand dismissed. Sd/- CHIEF JUSTICE Sd/- JUDGE ca "