TaxTMI 
TaxTMI 
2026 (7) TMI 921
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....ervice not completed for R2 to R4 No appearance for R5 And Others COMMON JUDGMENT DR. G. JAYACHANDRAN, J. The Central Excise Department initiated investigation in respect of appellants who were found to have failed in discharging their Service Tax liability under the GST Act. The action initiated by Central Excise Officers outside the local jurisdiction of tax payer is the bone of contention in these batch of appeals. That apart, the appellants, who received the show cause notices, relying on the Master Circular No:1503/2/2017-CX, dated 10/03/2017, have challenged the Show cause notices on the ground that before issuance of show cause notice, they should have been given an opportunity of pre-consultation. In some of the writ petitions, the Order-in-Original passed as a consequence of the show cause notice are challenged. 2. The conferment of power to the Central Excise Officers through out the country has emanated from the Notification No:22/2014 -Service Tax, dated 16/09/2014 issued by the Central Board of Excise and Customs (in short "CBEC") under which Officers in the Directorate General of Audit, Directorate General of Central Excise Intelligence and Directorate Gen....
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....of adjudication, Order- in- Original were also passed. 5. Challenging the vires of the notification conferring jurisdiction through out the territory of India to the Central Excise Officers, the consequential show cause notices and order-in-originals, a batch of writ petitions were filed under Article 226 of the Constitution of India, when came up for consideration before the Court, the learned Single Judge considering the facts of the case and the challenge to the actions taken by the department categorised the writ petitions under the following 3 heads:- Category No.1: Writ Petitions have been filed against the impugned Notification No.22/2014-ST, dated 16.09.2014 issued by the Central Board of Excise and Customs under power conferred by clause (b) of Section 2 of the Central Excise Act, 1944 (1 of 1944) read with Clause (55) of Section 65B of the Finance Act, 1994 (32 of 1994), Rule 3 of the Central Excise Rules, 2002 and Rule 3 of the Service Tax Rules, 1994. Category No.2: Writ Petitions have been filed against the impugned Show Cause Notices (SCNs) issued by the Additional Director General, Directorate of GST Intelligence of the respective Zonal Units and Princ....
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....ance of show cause notice issued by the Central Excise Officers, beyond the local limits is without any authority. 9. According to the Learned Counsels appearing for the appellants, the term "Local Limit", must be understood as a territory confined to a defined part of a State. In this regard, reference was made to the judgment of the Kerala High Court in P.Sivaramakrishnan v. State of Kerala reported in [1994 (5) TMI 24], wherein it was held that, the term "Local Limit" does not refer to the entire State, but a defined part thereof. Similarly, in Balaji Rice Company v. CTO reported in [1983 (4) TMI 243], the Andhra Pradesh High Court ruled that, the term " Local Limit" cannot mean the whole of State of Andhra Pradesh. The learned counsels further contended that as the impugned Notification override the act, it needs to be quashed, since Subordinate Legislation cannot travel beyond the parent statute. In support of the said contention, the learned counsels relied on the judgment in Commissioner of Central Excise, Bolpur v. Ratan Melting and Wire Industries reported in [2008 (12) S.T.R. 416 (S.C.)], wherein, the Hon'ble Supreme Court of India, held that clarifications/circulars, ....
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....ved earlier, we find that in some of the cases, the Central Excise Officers outside the jurisdiction of the taxpayers local limit, have caused show cause notices and directed the taxpayers to attend the adjudication proceedings outside their territorial jurisdiction. In few other cases, the situs of the adjudication is fixed within the Zonal limit of the Taxpayer. 14. Tracing the changes brought to Section 73 of the Finance Act, 1994, the learned counsels submitted that the power to issue show cause notice was conferred with the Assistant Commissioner of Central Excise or as the case may be, the Deputy Commissioner of Central Excise. Subsequently, with effect from 13.05.2005 the term "Assistant Commissioner of Central Excise" or as the case may be "Deputy Commissioner of Central Excise" was substituted with the term "Central Excise Officer". The learned counsels submitted that the legislators with a purpose had used the Article 'the' as prefix to the expression "Central Excise Officer" and not 'an' or 'a' and that the difference is very relevant and crucial for the purpose of interpretation. According to the learned counsels, the learned Single Judge had failed to appreciate the....
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.... Service Tax Rules, 1994, will not fetter the right of the Board to invest power on the Central Excise Officers throughout the territory of India. 17. Heard the learned counsels for both sides and perused the records. 18. The notification 22/2014, expressly traces the source of power to issue the said notification on conferring power under the said Notification Central Excise officers mentioned therein are invested with all powers under Chapter V of the Finance Act, 1994 through out the territory of India. Section 65B of Chapter V of the Finance Act, 1994, relates to interpretation and definitions. Clause 55 of Section 65B deals with words and expressions not defined. The residual clause, says, for the purpose of definition of those words and expressions, not defined in the Chapter V of the Finance Act, 1994, the definitions in the Central Excise Act, 1944, or the Rules made thereunder, need to be borrowed, as far as possible, in relation to service tax, as they apply in relation to duty of excise. 19. A close examination of expression used in Clause 55 reveals that the borrowing of the definition under the Central Excise Act, 1944, for expressions used, but not defined in....
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....id judgment, we find that the Hon'ble Division Bench of the Andhra Pradesh Court, though had referred the judgment of the Hon'ble Supreme Court of India in Jagannath v. State of Maharashtra reported in [AIR 1963 SC 728], has distinguished the judgement of the Hon'ble Supreme Court to give narrow meaning to the word and expression 'local limit'. However, when we look into the judgment of the Hon'ble Supreme Court, which is in respect to Section 14(1) of the Cr.P.C., as amended by the Bombay Act (23 of 1951), we find that the Hon'ble Supreme Court has observed that the expression 'local area' includes any part of the State and it may cover more than one district". Later, in National Building Construction Company Limited v. Union of India and others reported in [(2019) 62 GSTR 166], the Hon'ble Supreme Court, while testing the vires of similar notification issued by the Board vesting pan-India power on the Central Excise officers defined under the said act, held that Central Excise Officers of DGCEI have all India Jurisdiction and can issue notices and enquire into the matters relating to service tax against the assessee/person even if the said person or assessee is registered with on....
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....4, dated 16.09.2014, is therefore to be read in conjunction with the Notification No.38/2001-C.E.(N.T.) dated 26.06.2001. 25. A mere reference to Section 65B and Clause 55 of the Finance Act, 1994, in the subsequent Notification No.22 of 2014 will not take away the power of the Board which is otherwise vested with them. The deeming Clause or residuary clause under Section 65B read with Clause 55 applies only as far as possible, in respect of service tax qua duty of exercise not in respect of interpretation of the expression "Central Excise Officer". 26. The Notifications issued since 2001 have, in this regard, conferred pan-India jurisdiction upon the Central Excise Officers and the same has been acted upon throughout the country. Challenge to the plurality of jurisdiction and conferment of pan-India power on the Central Excise Officer been examined threadbare and held in favour of the Board. The notification which has sustained for decades and tested judicially cannot be upset by a pedantic interpretation. 27. The doctrine of "comity of jurisdiction" pleaded by the appellants relying on dictum laid down in Commissioner of Customs v. Sayed Ali reported in [2011) 265 ELT 17....