TaxTMI 
TaxTMI 
TaxTMI 
2022 (3) TMI 1615
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....e party-Adjudicating Authority that from the data obtained from the Income Tax Department it is revealed that the Petitioner having received considerable amount from different service recipients has made neither full disclosure of the amount in the returns in Form ST-3 nor has it filed the returns in Form ST-3 for certain period; thereby, it has evaded payment of service tax. The Adjudicating Authority proposed to proceed with determination of tax, interest and penalty for the periods 2015-16 and 2016-17 and therefore, he issued Demand-cum-Show Cause Notice dated 22.04.2021 calling upon the Petitioner to produce evidence to rebut the following:- "*** *** *** *** *** 6.0 Now, therefore the noticee, i.e. M/s. Nagen Caterer, at Samanta Sahi, P.O.: Buxibazar, Cuttack- 753001, bearing Service Tax Registration No. AAAAN1310KSD002 is called upon to Show Cause to the Additional Commissioner, CGST & CX, Bhubaneswar Commissionerate, C.R. Bu....
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....redients mentioned under proviso thereto, the extended period of limitation does not get attracted in the present context. 5. It is the further case of the Petitioner that there is illegality in issuance of Demand-cum-Show Cause Notice dated 22.04.2021 as the authority concerned has not considered the effect of Order dated 06.04.2021 of this Court in the case of the Petitioner's own case being Nagen Caterer Vrs. Central Board of Indirect Taxes & Customs & others, W.P.(C) No.24377 of 2020. Mr.Tushar Kanti Satapathy, counsel for the Petitioner placing reliance on the following paragraphs of the said order submitted that the assessing authority is precluded from raising demand which stood concluded by virtue of direction to issue SVLDRS-4 under Sabka Viswas Legacy Dispute Resolution Scheme, 2019 (SVLDRS):- "17. As far as the second writ petition filed by NC is concerned, in the counter affidavit again there is no explanation why the Designated Committee issued SVLDRS-2 and SVLDRS-2A without issuing SVLDRS-3. It is also not in dispute that the pre- deposit amount indicated therein is Rs.33,86,126/- whereas it should be Rs.39,41,880/- as indicated by NC in SVLDRS-1. The only defence ....
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....s the decisions cited and relied upon by the counsel for the Petitioner are in the connection with different setting of language in the statute compared to the Finance Act, 1994, they have no material bearing on the present facts and circumstances of the matter. 7. Heard Sri Tushar Kanti Satapathy, learned Advocate for the Petitioner and Sri. Choudhury Satyajit Mishra, Senior Standing Counsel. 8. Provisions for levy and imposition of service tax were introduced vide Chapter V in the Finance Act, 1994 and have been amended from time to time. Service tax does not have a separate enactment like the Central Excise Act, 1944, the Customs Act, 1962 or the Income Tax Act 1961. Section 65B of the Finance Act which deals with interpretation vide clause (55) states as follows: "(55) words and expressions used but not defined in this Chapter and defined in the Central Excise Act, 1944 (Act 1 of 1944) or the rules made thereunder, shall apply, so far as may be, in relation of service tax as they apply in relation to a duty of excise." Explanation clarifies for removal of doubts that provisions of Section 66 of Chapter V of the Finance Act for the purpose of levy and collection of service ....
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....service tax payable has been self-assessed in the return furnished under sub- section (1) of section 70, but not paid either in full or in part, the same shall be recovered along with interest thereon in any of the modes specified in section 87, without service of notice under sub-section (1). (2) The Central Excise Officer shall, after considering the representation, if any, made by the person on whom notice is served under sub-section (1), determine the amount of service tax due from, or erroneously refunded to, such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount so determined : (2A) Where any appellate authority or tribunal or court concludes that the notice issued under the proviso to sub-section (1) is not sustainable for the reason that the charge of,- (a) fraud; or (b) collusion; or (c) wilful misstatement; or (d) suppression of facts; or (e) contravention of any of the provisions of this Chapter or the rules made there under with intent to evade payment of service tax; has not been established against the person chargeable with the service tax, to whom the notice was issued, the Central Excis....
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....* * *** *** *** (4B) The Central Excise Officer shall determine the amount of service tax due under sub-section (2)- (a) within six months from the date of notice where it is possible to do so, in respect of cases falling under sub-section (1); (b) within one year from the date of notice, where it is possible to do so, in respect of cases falling under the proviso to sub-section (1) or the proviso to sub-section (4A). (5) The provisions of sub-section (3) shall not apply to any case where the service tax had become payable or ought to have been paid before the 14th day of May, 2003. (6) For the purposes of this section, "relevant date" means,- (i) in the case of taxable service in respect of which service tax has not been levied or paid or has been short-levied or short-paid - (a) where under the rules made under this Chapter, a periodical return, showing particulars of service tax paid during the period to which the said return relates, is to be filed by an assessee, the d....
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.... non-payment, short levy, short payment and erroneous refund. Section 83 Chapter V of the Finance Act, 1994 empowers the Authority to invoke Section 14 of the Central Excise Act, 1944 which empowers the Officer to issue summons to any person to give evidence and produce documents. The summons can be issued to any person whose attendance the officer considers necessary. The power can be exercised to collect evidence or a document or any other thing in any inquiry which the officer is making for any purposes under the Act. Perusal of the impugned notice vide Annexure-1 to the writ petition shows that it contains reasons for issue of notice and it specifies the amount for which recovery proceedings have been initiated. The Show Cause Notice contains particulars with factual and legal assertions why recovery of the amount quantified should not be made on account of short levy, short payment or erroneous refund. These details and particulars are ascertained and found mentioned in the Show Cause Notice itself, as they would constitute the basis and foundation of the notice under Section 73(1) of the Finance Act. Proviso to sub-section (1) of Section 73 extends recovery for a period up ....
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....ns do relate to service tax vis-à-vis records that would be produced and/or evidence adduced by the Petitioner? iv. Whether the transactions (partly or wholly) which were considered under the SVLDRS, 2019 as reflected in the Order dated 06.04.2021 of this Court in the case of present Petitioner in W.P.(C) No.24377 of 2020 are covered in the subject-matter of impugned Show Cause Notice relating to 2015-17 (two financial years)? These are illustrations of questions of fact which may crop up along with any other factual aspects during the process of adjudication under Section 73 of the Finance Act. Furthermore, it has been held in Ramesh B Desai Vrs. Bipin Vadilal Mehta, (2006) 5 SCC 638 that a plea of limitation is a mixed question of law and fact. In the instant case the Adjudicating Authority is competent to decide whether service tax proposed to be levied for the periods 2015-16 and 2016-17 would be comprehended within the ingredients specified under proviso to sub-section (1) of Section 73 of the Finance Act. Conclusion is required to be arrived at by the Adjudicating Authority including the Appellate Fora provided under the statute that on the facts and materials avail....
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....f the Constitution confers on all the High Courts a very wide power in the matter of issuing writs. However, the remedy of writ is an absolutely discretionary remedy and the High Court has always the discretion to refuse to grant any writ if it is satisfied that the aggrieved party can have an adequate or suitable relief elsewhere. The Court, in extraordinary circumstances, may exercise the power if it comes to the conclusion that there has been a breach of principles of natural justice or procedure required for decision has not been adopted. 13. Another Constitution Bench of this Court in State of M.P. v. Bhailal Bhai [(1964) 6 SCR 261 : AIR 1964 SC 1006] held that the remedy provided in a writ jurisdiction is not intended to supersede completely the modes of obtaining relief by an action in a civil court or to deny defence legitimately open in such actions. The power to give relief under Article 226 of the Constitution is a discretionary power. Similar view has been reiterated in N.T. Veluswami Thevar v. G. Raja Nainar [1959 Supp (1) SCR 623 : AIR 1959 SC 422] , Municipal Council, Khurai v. Kamal Kumar [(1965) 2 SCR 653 : AIR 1965 SC 1321] , Siliguri Municipality v. Amalendu Da....
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....'Caesar to Caesar's wife' the existence of alternative remedy would be a mirage and an exercise in futility. ... There are two well- recognized exceptions to the doctrine of exhaustion of statutory remedies. First is when the proceedings are taken before the forum under a provision of law which is ultra vires, it is open to a party aggrieved thereby to move the High Court for quashing the proceedings on the ground that they are incompetent without a party being obliged to wait until those proceedings run their full course. Secondly, the doctrine has no application when the impugned order has been made in violation of the principles of natural justice. We may add that where the proceedings themselves are an abuse of process of law the High Court in an appropriate case can entertain a writ petition." The above position was recently highlighted in U.P. State Spg. Co. Ltd. v. R.S. Pandey [(2005) 8 SCC 264 : 2005 SCC (L&S) 78] , SCC pp. 270-72, paras 10-16." 14. It may be worthwhile to state that writ petition is not entertainable against the Show Cause Notice in view of parameters laid down in Union of India Vrs. Coastal Container Transporters Association, (2019) 20 SCC 446; Sout....
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....9] , Pratap Singh v. State of Haryana [(2002) 7 SCC 484 : 2002 SCC (L&S) 1075] and GKN Driveshafts (India) Ltd. v. ITO [(2003) 1 SCC 72] .] *** *** *** *** 15. Thus, while it can be said that this Court has recognised some exceptions to the rule of alternative remedy i.e. where the statutory authority has not acted in accordance with the provisions of the enactment in question, or in defiance of the fundamental principles of judicial procedure, or has resorted to invoke the provisions which are repealed, or when an order has been passed in total violation of the principles of natural justice, the proposition laid down in Thansingh Nathmal case [AIR 1964 SC 1419] , Titaghur Paper Mills case [Titaghur Paper Mills Co. Ltd. v. State of Orissa, (1983) 2 SCC 433 : 1983 SCC (Tax) 131] and other similar judgments that the High Court will not entertain a petition under Article 226 of the Constitution if an effective alternative remedy is available to ....
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....order passed by an authority with respect to a matter over which it has no jurisdiction is a nullity and is open to collateral attack, an order passed by an authority which has jurisdiction over the matter, but has assumed it otherwise than in the mode prescribed by law, is not a nullity. It may be liable to be questioned in those very proceedings, but subject to that it is good, and not open to collateral attack. Therefore even if the proceedings for assessment were taken against a non-registered dealer without the issue of a notice under Section 10(1) that would be a mere irregularity in the assumption of jurisdiction and the orders of assessment passed in those proceedings cannot be held to be without jurisdiction and no suit will lie for impeaching them on the ground that Section 10(1) had not been followed. This must a fortiori be so when the appellant has itself submitted to jurisdiction and made a return. We accordingly agree with the learned Judges that even if the registration of the appellant as a dealer under Section 8 is bad that has no effect on the validity of the proceedings taken against it under the Act and the assessment of tax made thereunder." 18. This Court in....
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....to have responded to the show cause notices by placing material in support of their stand but at the same time, there is no reason to approach the High Court questioning the very show cause notices. Further, as held by the High Court, it cannot be said that even from the contents of show cause notices there are no factual disputes. Further, the judgment of this Court in the case of Malladi Drugs & Pharma Ltd. v. Union of India, (2020) 12 SCC 808 : 2004 SCC OnLine SC 358, relied on by the learned senior counsel for the appellants also supports their case where this Court has upheld the judgment of the High Court which refused to interfere at show cause notice stage." 21. The Supreme Court of India in South India Tanners & Dealers Association Vrs. Deputy Commissioner of Commercial Taxes, (2008) 23 VST 8 (SC) expressed displeasure in entertainment of writ petition against the Show Cause Notice. The Hon'ble Supreme Court in the said case laid down the modality for the Authority in the following terms: "2. We have repeatedly stated that as far as possible the High Courts should not interfere in matters at show cause notice stage. 3. Without reply to the show cause notice the appell....
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....six months and up to a period of 5 years in view of the proviso to sub-section (1) of Section 11-A of the Act, it has to be established that the duty of excise has not been levied or paid or short-levied or short-paid, or erroneously refunded by reasons of either fraud or collusion or willful misstatement or suppression of facts or contravention of any provision of the Act or Rules made thereunder, with intent to evade payment of duty. Something positive other than mere inaction or failure on the part of the manufacturer or producer or conscious or deliberate withholding of information when the manufacturer knew otherwise, is required before it is saddled with any liability, before (sic beyond) the period of six months. Whether in a particular set of facts and circumstances there was any fraud or collusion or willful misstatement or suppression or contravention of any provision of any Act, is a question of fact depending upon the facts and circumstances of a particular case." 6. Hon'ble Single Judge of Calcutta High Court in the case of Infinity Infotech Parks Ltd., (2015) 85 VST 465 (Cal) appears to have placed reliance on the judgment of Hon'ble Supreme Court as noted hereinabo....
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....urn. A show- cause notice is issued to the dealer with the purpose of informing him that the Department proposes to reopen the assessment because the Commissioner himself is satisfied that the dealer has furnished incorrect statement of his turnover or incorrect particulars of his sales in the return submitted, so as to enable the dealer to reply to the show-cause notice as to why the said power vested in the Commissioner should not be exercised. 15. A notice was issued in order to provide an opportunity of natural justice to the dealer. There is nothing in the language of the aforesaid provision which either expressly or impliedly mandates the recording of any reasons. The provision of the Act nowhere postulates that the reasons which led to the issue of the said notice should be incorporated in the notice itself, and that in case of failure to do so, the same would invalidate the notice. 16. The aforesaid provision is clear and explicit and there is no ambiguity in it. If the legislature had intended to give any other meaning as suggested by the counsel appearing for the appellant it would have made specific provision laying down such conditions explicitly and in clear words.....
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....lows: "13. It must be noted that while issuing a show-cause notice under Section 11-A of the Act, what is entertained by the Department is only a prima facie view, on the basis of which the show-cause notice is issued. The determination comes only after a response or representation is preferred by the person to whom the show-cause notice is addressed. As a part of his response, the person concerned may present his view point on all possible issues and only thereafter the determination or decision is arrived at. In the present case even before the response could be made by the respondent and the determination could be arrived at, the matter was carried in appeal against the said internal order. The appellant was therefore, justified in submitting that the appeal itself was premature." 26. At this stage where Demand-cum-show cause notice has been issued to the Petitioner-Nagen Caterer, various aspects are found mentioned in the impugned Show Cause Notice as to why the Adjudicating Authority has sought to invoke the extended period of limitation in terms of proviso to sub-section (1) of Section 73 of the Finance Act which essentially relates to the facts and circumstances of the ca....