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Container Tea and Commodities, represented by its Partner v/s Commissioner, O/o The Commissioner of Customs and Central Excise

    Writ Petition No.33342 of 2012 and M.P.No.1 of 2012
    Decided On, 13 December 2012
    At, High Court of Judicature at Madras
    By, THE HONOURABLE MR. JUSTICE R. SUDHAKAR
    For the Petitioner: Pushyastharaman, Senior Counsel for Mrs. Hema Muralikrishnan, Advocate. For the Respondents: -----


Judgment Text
(Prayer: Writ Petition is filed under Article 226 of Constitution of India praying to issue a Writ of Certiorari, call for the records of the respondent in C.No.V/BAS/15/144/2009-S.T.ADJ and quash the order Sl.No.07/2012 (Commissioner) dated 30.10.2012 passed therein.)

This Writ Petition is filed praying to issue a Writ of Certiorari, call for the records of the respondent in C.No.V/BAS/15/144/2009-S.T.ADJ and quash the order Sl.No.07/2012 (Commissioner) dated 30.10.2012 passed therein.

2. The matter relates to an order passed by the Commissioner of Customs and Central Excise, Salem under the provisions of Service Tax, Finance Act 1994. A show-cause notice was issued stating as follows:-

"02.07. On analytical study of activities of CT&C, it is observed that they have rendered various services for the exporters to promote their business in overseas. Therefore, it appears that service rendered by CT&C for the promotion or marketing or sale of goods produced by their clients are squarely fall under the category of "Business Auxiliary Service" in terms of Section 65(19) of Finance Act, 1994, a taxable service. The service provider i.e., CT&C had neither followed the service tax procedures nor paid the appropriate service tax on the gross amount received from the exporters. As the service provider appears to have failed to pay the service tax by following the prescribed service tax procedure with the intention to evade payment of Service tax, a show cause notice was issued to the Service provider requiring them to show cause as to why,

(i) the extended period under proviso to Section 73 of Finance Act, 1994 should not be invoked to demand service tax not paid in as much as they have suppressed the fact of having rendered the service of "Business Auxiliary Service",

(ii) the amount of Rs.1,35,53,523/- (Service Tax Rs.1,32,32,549/- + Edu. Cess Rs.2,64,651/- + S & H Edu. Cess Rs.56,323/-) for the period from 01/10/04 to 30/09/09 should not be demanded from them under Section 73(1) of the Finance Act, 1994,

(iii) an interest at the appropriate rate should not be demanded from them under Section 75 of the Finance Act, 1994,

(iv) penalties should not be imposed on them under Section 76, 77 & 78 of the Finance Act, 1994."

3. A reply was submitted. Factual and legal plea were raised and on the basis of a full-fledged adjudication, the authority gave a finding against the petitioner in terms of the charge made in the show cause notice and that finding relates to the merits of the department case for demanding service tax rendered under the head ‘Business Auxiliary Service’. Besides, the authority has gone in extenso to define sales and marketing and the difference between marketing and sales to come to the conclusion that the petitioner is liable to pay service tax. The service tax was demanded and consequent thereupon interest and penalty was levied. On each one of the issues a definite finding was rendered by the authority and a final order came to be passed on 30.10.2010 as follows:

"(i) I confirm the demand to the tune of Rs.1,35,53,523/- (Rupees one crore thirty five lakhs fifty three thousand five hundred and twenty three only) demanded in Show cause notice C.No:V/BAS/15/144/2009-ST.ADJ SCN S.No:15/2011 (Commissioner) Dated: 28.03.2011) and also I confirm the demand to the tune of Rs.37,16,942/- (Rupees thirty seven lakh sixteen thousand nine hundred and forty two only) demanded in the show cause notice in No.V/BAS/15/20/2012 ST.Adj [SCN Sl.No.07/2012 (ADC)] dated 14.03.2012, being Service Tax on the Taxable value received for the said Service during the period 01.10.2004 to 31.03.2011, from M/s.Container Tea & Commodities, Coonoor under proviso to Section 73(2) of Chapter V of the Finance Act, 1994;

(ii) I demand appropriate interest on the amount demanded at S.No.(i) above from M/s.Container Tea & Commodities, Coonoor, under section 75 of the Finance Act 1994;

(iii) (a) I impose a penalty @ Rs.200/- per day on M/s.Container Tea & Commodities, Coonoor, for non-registration of their service till such date by which they obtain Service Tax Registration Certificate, under Section 77 of the Finance Act 1994;

(iii) (b) I impose a penalty of Rs.5,000/- on M/s.Container Tea & Commodities, Coonoor, under Section 77 of the Finance Act, 1994 for non filing of the ST3 returns;

(iv) I impose a penalty of 1,72,70,465/- on M/s.Container Tea & Commodities, Coonoor, under Section 78 of the Finance Act 1994."

As against the above order, the present writ petition is filed pleading that one or other factual issues raised by the petitioner and legal plea taken has not been considered by the authority while passing the impugned order.

4. As against the impugned order, an appeal lies to the Appellate Tribunal which is empowered to consider all the factual and legal issues raised by the petitioner on merits.

5. Learned counsel for the petitioner does not plead violation of principles of natural justice, lack of jurisdiction or that the impugned order has been passed in an arbitrary and capricious manner by the authority. What is pleaded by the counsel is on the interpretation of the various provisions based on factual issues in the case. It is trite law that this court under Article 226 of the Constitution will not be a court of appeal or examine for itself the correctness of the decision impugned and decide what is the proper view to be taken or the order to be made. See AIR 1952 SC 192 Veerappa Pillai - vs.- Raman and Raman Limited. In the said decision, the Apex Court held that where matter involves disputed questions of

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fact or mixed question of law and fact or even ordinary question of law, it could be raised in appeal provided under the statute. See also (i)AIR 1957 SC 529 Sohan Lal vs. Union of India, (ii) AIR 1964 SC 1260, Basant Kumar v. Eagle Rolling Mills and (iii) AIR 1964 1419 Thansingh vs. Superintendent of Taxes. 6. Therefore prima facie this court is not inclined to interfere with the order at this stage. As a result the petitioner has to pursue the alternative remedy provided under the Act. 7. The Writ Petition stands disposed of in the above terms. No costs. Consequently, connected miscellaneous petition is closed.
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