TaxTMI 
TaxTMI 
2016 (4) TMI 1036
X X X X Extracts X X X X
X X X X Extracts X X X X
....aration that circular No.151/2/2012 dated 10.2.2012 issued by the Central Board of Excise and Customs and the recommendations made by the Tax Research Unit of the Ministry of Finance on 20.1.2016 are unconstitutional and ultra vires the powers of the Parliament under Article 246(3) read with Entry 49 of List II of the Seventh Schedule and the Finance Act, 1994. 2. Heard Mr.B.N.Suchindran, learned counsel appearing for the petitioner. Mr.A.P.Srinivas, learned Senior Panel Counsel takes notice for the respondents 1 to 4. Mr.G.Natarajan, learned counsel appears for the fifth respondent. 3. As stated earlier, an agreement tiled 'agreement for development' was entered into on 20.2.2013 between the writ petitioner, his brothers and ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ection 66B of the Finance Act, 1994, the fifth respondent appears to have sent an e-mail dated 4.2.2016 demanding service tax to the tune of Rs. 12,85,077/- together with a VAT amount of Rs. 96,000/-. The claim was so made by the fifth respondent on the basis of the provisions of the Finance Act, 1994, the scope of the circulars issued thereunder and also in terms of Clause 23 of the agreement for development. 6. However, contending that the agreement did not envisage the rendition of any services so as to attract payment of service tax and also contending that for the mere exchange of a property, there could not be a service tax, the petitioner came up with the above writ petition challenging the very provisions of Section 66B read with....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... relating to the turnover, etc., that were in dispute before the said Court. Where there is a private lis with respect to certain disputed facts, out of which, the liability arises, it may perhaps be open to the person, on whom, the burden is passed on, to question the assessment orders. 10. In U.P. Solvent Extractors Association, a Division Bench of the Allahabad High Court simply rejected the argument of locus standi by observing in one line that the concept of locus standi is getting widened. The said decision does not deal with the law on the point. 11. In Assistant General Manager, Central Bank of India Vs. Commissioner, Municipal Corporation [1995 (4) SCC 696], the tenant of a building challenged the enhancement of tax ordered b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....increase in the incidence of sales tax affects all consumers of all products. Therefore, any person will be entitled to come and challenge the increase in the levy on the ground that the manufacturer or dealer will eventually pass on the burden only to the ultimate consumer. We can quote any number of examples of this nature. Every citizen is a consumer of any number of products. Every Finance Act imposes an additional burden upon many such products. Millions of consumers are entitled to come and challenge such levies, if such a contention is accepted. Therefore, we are of the considered view that the petitioner has no locus standi to challenge the above circulars. 15. Though the petitioner expresses the apprehension that the service tax....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ndent to put up a construction and exchange 35% of the constructed area with 35% of the undivided share of land. Therefore, his contention is that it was just an exchange of one immovable property for another. Hence, his case is that the service, if at all rendered by the fifth respondent, falls within the exempted category under Sub-Clause (i) of Clause (a) of Sub-Section (44) of Section 65B. 19. An alternative submission was made to the effect that if the above transaction is not considered to be an exchange, it could, at the best, be termed as a sale. The petitioner and his siblings have agreed to sell 35% of the undivided shares in the land to the nominees of the fifth respondent and the fifth respondent has agreed to pay a considera....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ay of sale or exchange. 24. In Magus Construction Pvt. Ltd., the dispute that the Gauhati High Court was concerned with was a dispute between the flat purchasers and the promoter. The case did not arise out of a dispute between the developer and the original land owner. 25. In the second last paragraph of its judgment, the Gauhati High Court indicated that as per the circular dated 1.8.2006, when a builder, promoter or developer undertook construction activity for its own self, the relationship of service provider and service recipient was absent and that therefore, the question of providing taxable service did not arise. 26. But, in the case on hand, the agreement that the petitioner had, cannot be separated into two portions. The....