TaxTMI 
TaxTMI 
2024 (12) TMI 793
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....able immediately at the request and with the consent of the learned counsel for the parties. 3. By this petition under Article 226 of the Constitution of India, the Petitioner has sought a writ of mandamus against the respondents for a refund of Rs.333.08 crore being deposit made 'under protest' for the period April 2007 to June 2017 with respect to the Service Tax Liability on 'Interchange Fees.' The petitioner further seeks a writ of mandamus directing the respondents to process the refund applications filed for refund of the said amount of Rs.333.08 crore and seeks quashing of show cause notice dated 11 May 2015 issued by the respondents seeking to recover the service tax amounting to Rs.82.26 crore on the interchange fees and why the s....
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.... the show cause notice. The petitioner replied to the above show cause notices vide letters dated 20 April 2021, 11 May 2021, 31 May 2021 and 12 April 2023 and raised various contentions and prayed for adjudication of the show cause notice since non-adjudication of the show cause notice and the refund applications was impacting its working capital requirements. It is on this backdrop, the present petition is filed seeking relief stated above. 6. Mr. Shroff, learned Senior Advocate for the petitioner submitted that the show cause notice dated 11 May 2015 having not been adjudicated till today has become stale and on account of delayed adjudication, the said show cause notice should be quashed and set aside. Learned Senior Advocate further s....
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....esent petition. 8. We have heard learned Senior Advocate for the petitioner and the learned counsel for respondent nos. 2 and 3. 9. At the outset, we strongly deprecate the respondents' practice in not adjudicating upon the refund applications and the show cause notice for years. This practice severely affects the working capital requirements of any business entity, particularly if it is a bank. The respondents cannot sit over the refund applications or the show cause notice and not adjudicate the same. This sends a wrong signal to the business community and foreign investors and works against the slogan 'Ease of Doing Business.' It is in the interest of the revenue themselves to adjudicate the proceedings as early as possible, and if....
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....tice on the ground of delay today, after having prayed for adjudication of the show cause notice as late as April 2023, cannot be accepted. We, therefore, reject the petitioner's prayer. However, the issue of alleged delay in adjudication of the show cause notice is kept open for the petitioner to be raised before the adjudicating authority, in addition to any other ground which the petitioner may raise on the merits of the case. 11. Now, coming to the prayer relating to the refund applications, at this stage, it would not be appropriate for the Court to direct the respondents to grant a refund as that would require examining the facts recorded in the refund applications and the contention raised by the petitioner that the issue is cov....
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....cause our experience is that the respondents are reluctant to pass a favourable order on some or the other pretext in matters where the stakes are high. This is not the correct approach. The stakes should not determine the legality of the action. 13. Now we come to the decision of the Coordinate Bench in the case of HSBC (supra) and the petitioner's contention that this Court should direct refund of deposit made 'under protest.' The case of HSBC (supra) relied upon by the petitioner was a case where the refund application was processed. Order-in-original was passed denying the refund, which was set aside by the appellate authority. No further proceedings were taken, and it was in these circumstances that the petitioner was deprived of the ....
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....he duty of disposing of the refund applications. Therefore, a mandamus must be issued to direct the expeditious disposal of the refund applications. But, in this case, we cannot issue a mandamus to directly refund the amount claimed, thereby denying the authorities an opportunity to examine the petitioner's refund claim following the law and on its merits. The position in the HSBC case relied by Mr. Shroff was different in the sense that there was a clear determination of the refund dues by the appellate authority. Yet, without challenge to such determination, the authorities were sitting on the refund application without any good reason. The mandamus was, therefore, to implement the appellate authority's order, which had attained finality.....