TaxTMI 
TaxTMI 
2018 (10) TMI 904
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.... various dates issued by the Assistant Commissioner, Central Goods and Service Tax of the district of Dibrugarh and Guwahati respectively are assailed. The said demand-cum-show cause notices are purportedly issued under Sections 75, 76 and 78 in respect of a proceeding initiated under Section 73(i) of the Finance Act of 1994, for failure on the part of the petitioners from paying the service tax that are leviable upon them. In all the writ petitions, the demand-cum-show cause notices are assailed on the ground that in view of the provisions of Section 173 of the Central Goods and Service Tax Act, 2017 ((for short, CGST Act of 2017), further proceedings that were initiated under Section 73(i) of the Finance Act of 1994 are no longer sustainable. 3. In the circumstance, a common question of law is involved in all the writ petitions, a determination of which would lead to an adjudication of the dispute raised therein, the writ petitions are taken up together for a final consideration. 4. Mr. KN Choudhury, learned Senior counsel for the petitioners raises an issue that Section 173 of the CGST Act of 2017 having omitted chapter V of the Finance Act of 1994, no proceeding initiated....
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....nder R. 132A of the D.I.Rs. could have been instituted even after the repeal of that rule. 18.The last case relied upon is 1. K. Gas Plant Manufacturing Co., (Rampur) Ltd. and Others v. The King Emperor(2). In that case, the Federal Court had to deal with the effect of sub-s. (4) of section 1 of the Defence of India Act, 1939 and the Ordinance No. XII of 1946 which were also considered by the Allahabad High Court in the case of Seth Jugmendar Das & Ors. (2). After quoting the amended sub-s. (4) of s. 1 of the Defence of India Act, the Court held :- "The express insertion of these saving clauses was no doubt due to a belated realisation that the provisions of s. 6 of the General Clauses Act (X of 1897) apply only to repealed statutes and not to expiring statutes, and that the general rule in regard to the expiration of a temporary statute is that unless it contains some special provision to the contrary, after a temporary Act has expired, no proceedings can be taken upon it and it ceases to have any further effect. Therefore, offences committed against temporary Acts must be prosecuted and punished before the Act expires and as soon as the Act expires any procee....
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....vision in a statute is omitted and in its place another provision dealing with the same contingency is ] introduced without a saving clause in favour of pending proceedings then it can be reasonably inferred that the intention of the legislature is that the pending proceeding shall not continue but a fresh proceeding for the same purpose may be initiated under the new provision." (iii) Paragraphs 8 and 9 of General Finance Co. and Another (supra): "8.Though we find the submissions of the learned counsel to be forceful, we are constrained to follow the two decisions of the Constitution Benches of this Court in Messrs Rayala Corporation (P) Ltd. case (supra) and Kolhapur Canesugar Works Ltd. case (supra). This view has held the field for over three decades and reiterated even as late as two years ago. Non-compliance with Section 269SS of the Act attracted prosecution as well as penalty. Omission of the provision regarding prosecution will not affect the levy of penalty. The advantage arising out of application of the ratio of the two decisions resulting in prosecution in cases of non-compliance with Section 269SS of the Act is only transitional affecting a few cases arisi....
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....lation, it would be wholly unnecessary to state that on a construction of the word "repeal" in Section 6 of the General Clauses Act, "omissions" made by the legislature would not be included. Assume, on the other hand, that the Constitution Bench had given two reasons for the non-applicability of Section 6 of the General Clauses Act. In such a situation, obviously both reasons would be ratio decidendi and would be binding upon a subsequent Bench. However, once it is found that Section 6 itself would not apply, it would be wholly superfluous to further state that on an interpretation of the word "repeal", an "omission" would not be included. We are, therefore,l of the view that the second so-called ratio of the Constitution Bench in Royala Corpn. (P) Ltd. cannot be said to be a ratio decidendi at all and is really in the nature of obiter dicta. 32. Secondly, we find no reference to Section 6-A of the General Clauses Act in either of these Constitution Bench judgments. Section 6-A read as follows: "6-A. Repeal of Act making textual amendment in act or Regulation- Where any Central Act or Regulation made after the commencement of this act repeals any enactment by whi....
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.... p. 837) "7. ... We do not intend to detract from the rule that, in exceptional instances, where by obvious inadvertence or oversight a judgment fails to notice a plain statutory provision or obligatory authority running counter to the reasoning and result reached, it may not have sway of binding precendents. It should be a glaring case, an obtrusive omission. No such situation presents itself here and we do not embark on the principle of judgment per incuriam." (emphasis supplied) An interesting applications of the said principle is contained in state of U.P. v. Synthetics and Chemicals Ltd., (1991) 4 SCC 139 : (1991) 3 SCR 64, where a Division Bench of this Court held that once particular conclusion of a Bench of seven Judges [Synthetics and Chemicals Ltd. v. State of U.P., (1990) 1 SCC 109] was per incuriam - see: the discussion at SCR pp.80, 81 and 91 : SCC pp. 151, 152 and pp.161-162, paras 36 to 42 of the said judgment. By necessary implication the same intention as that which would attend the case of an express repeal. Where an intention to effect a repeal is attributed to a legislature then the same would, in our opinion, attract the incident of t....
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.... not apply to a Rule but applies only to a Central Act or Regulation and secondly, Section 6 itself would apply only to a repeal and not to an omission. 11. In paragraph 37 of the pronouncement in Kolhapur Canesugar Works Ltd. (supra), it has been held that the normal effect of repealing a statue or deleting a provision is to obliterate it from the statue book as it had never been passed and the statue must be considered as a law that never existed, but an exception is engrafted under Section 6 of the General Clauses Act and, accordingly, if a provision of a statute is unconditionally omitted without a saving clause in favour of the pending provisions, all actions must stop where the omissions finds them and if the final relief had not been granted before the omission went into effect, it cannot be granted afterwards. 12. In this regard, it may be taken note of that in page 958 of the Principles of Statutory Interpretation by Justice GP Singh, it had been provided that the passing observation in Rayala Corporaion (P) Ltd (supra) and in Kolhapur Canesugar Works Ltd. (supra) that Section 6 of the General Clauses Act only applies to repeals and not to omissions, needs a reconstr....
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....and not to an omission would not be ratio decidendi at all and that it really is in the nature of an obiter dicta. 16. In paragraph 32 of Fibre Board Pvt. Ltd (supra) the Supreme Court also took note of the provisions of Section 6-A of the General Clauses Act which provides that where any Central Act or Regulation repeals any enactment by which the text of any Central Act or Regulation was amended by an expressed omission, amongst others, than unless a different intention appears, the repeal shall not affect the continuance of any such amendment made by the enactment so repealed and in operation at the time of such repeal. 17. Upon such consideration in paragraph 33, it has been provided that the absence of any reference to Section 6-A in Rayala Corporation (P) Ltd (supra) and in Kolhapur Canesugar Works Ltd. (supra), undoes the binding effects of the two judgments by the application of the Principles of per incuriam. 18. From the propositions laid down in Fibre Board Pvt. Ltd (supra) it is discernible that the earlier propositions laid down Rayala Corporaion (P) Ltd (supra) and in Kolhapur Canesugar Works Ltd. (supra), to the extent that Section 6 of the General Clauses A....
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....). The said contention of the learned Senior Counsel for the petitioner would have to be looked into from the point of view as to whether the decision rendered in FibreBoard Pvt. Ltd. is a decision which is in conflict with the view expressed in Rayala Corporation (P) Ltd (supra) and in Kolhapur Canesugar Works Ltd. (supra). 21. To that extent, we take note of paragraph 30 of FibreBoard Pvt. Ltd, wherein the Supreme Court was conscious of the fact that in the event, a conflicting view is to be taken to an earlier pronouncement by a larger bench, it requires a reference to a larger bench. While dealing with the proposition laid down in Rayala Corporation (P) Ltd (supra) and in Kolhapur Canesugar Works Ltd. (supra), the Supreme Court was conscious of the aspect of referring the matter to a larger bench, but thought it to be not required in view of what had been laid down in the said decision. 22. Secondly, in Fibre Board Pvt. Ltd (supra) the Supreme Court took a view that the decisions rendered in Rayala Corporation (P) Ltd (supra) and in Kolhapur Canesugar Works Ltd. (supra) are per incuriam to the provisions of Section 6-A of the General Clauses Act. Further in paragraph 31 o....
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....here the omission finds them and if the final relief was not granted before the omission went into effect, it cannot be granted afterwards. 27. But in paragraph 37, it was further provided that the operation of repeal or deletion as to the future and the past largely depend upon the savings applicable. It also provided that in a case where a particular provision in a statute is omitted and in its place another provision dealing with the same contingency is entrusted without the savings clause in favour of the pending proceedings, it can be reasonably inferred that the intention of the legislature is that the pending proceeding shall not continue, although a fresh proceeding for the same purpose may be initiated under the new provision. 28. In other words, the proposition laid down in paragraph 37 of Kolhapur Canesugar Works Ltd. (supra) is that the continuance of a further proceeding under an omitted Act depends upon as to whether a savings clause is provided in the enactment by which the earlier enactment was omitted. In the instant case, it is taken note of that the provisions of Chapter V of the Finance Act of 1994 were omitted by Section 173 of the CGST Act of 2017, where....
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.... remain in place inspite of such omission of Chapter V of the Finance Act. In other words, Section 174(2)(e) is a savings clause in respect of any investigation, enquiry etc., that was/to be instituted under Chapter V of the Finance Act of 1994. A conjoint reading of Section 173 and 174(2)(e) would show that while bringing an omission to the provision of Chapter V of the Finance Act of 1994, a savings clause for continuing with the proceedings initiated/to be initiated was also duly provided. Existence of the savings clause in respect of omission of Chapter V of the Finance Act of 1994 clearly brings it within the purview of the provisions laid down by the Constitution Bench of the Supreme Court in paragraph 37 of Kolhapur Canesugar Works Ltd. (supra). 32. As already elucidated hereinabove, paragraph 37 of Kolhapur Canesugar Works Ltd. (supra) provides that if a statute stood omitted with a savings clause, the savings clause would not render it impermissible for the proceedings initiated/to be initiated under Chapter V of the Finance Act of 1994, which stood omitted by Section 173 of the CGST Act of 2017 to be continued. 33. A conjoint reading of the provisions laid down in p....