Court dismisses challenge to Service Tax notice on rented premises by Municipal Corporation, directs objections to assessing authority.

The court dismissed the petition challenging a notice for Service Tax recovery, stating that the issue of levying Service Tax on rented premises by a Municipal Corporation had been previously settled. The court directed the petitioner to raise objections before the assessing authority, who would consider them during the assessment proceedings. No coercive recovery actions could be taken until the assessment process was finalized. The court emphasized following statutory procedures and provided for appeal and revision options.

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Issues:
Challenging a notice issued by the Assistant Commissioner regarding Service Tax recovery. Question of levying Service Tax on rented premises by a Municipal Corporation. Whether Service Tax is applicable if premises rented by the Municipal Corporation in discharge of statutory duty.

Analysis:
The petitioner filed a writ petition challenging a notice issued by the Assistant Commissioner, Central Excise and Service Tax, regarding the recovery of Service Tax. The petitioner argued that Service Tax should not be levied on property rented by the Municipal Corporation. However, based on previous judgments, it was established that the question of levying Service Tax on renting out premises had already been decided and was not sub judice.

The petitioner contended that even if Service Tax is applicable to rented premises, if the Municipal Corporation rented the premises in discharge of its statutory duty, then Service Tax should not be imposed. The court held that this objection should be raised before the assessing authority who issued the show cause notice. The assessing authority is responsible for considering this objection initially and making a decision. Any order issued by the assessing authority is subject to appeal, further appeal, and revision before the appellate authority and Tribunal.

The court directed that the competent authority should consider the petitioner's objections when the petitioner shows cause before them. The competent authority must then make an appropriate order regarding the petitioner's assessment liability. This order will also be subject to statutory appeal and revision available to the petitioner. No coercive steps for the recovery of Service Tax can be taken until the assessment proceedings are concluded after issuing notice to and hearing the petitioner.

In conclusion, the court disposed of the petition, stating that there was no case for interference at that stage. The petitioner was directed to follow the statutory procedures, and no coercive recovery measures could be initiated until the assessment proceedings were completed. A certified copy of the order was to be provided to the parties in accordance with the rules.

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