ST - Matters which raise essentially disputed questions of fact cannot be decided by High Court - entertaining petition would amount to scuttling inquiry and delaying adjudication: HC
By TIOL News Service
MUMBAI, SEPT 14, 2015: THIS is a Service Tax case. The petitioner is before the Bombay High Court and prays for quashing and setting aside the SCN dated 24th April 2015.
It is the submission of the petitioner that the SCN has been issued without jurisdiction.
Inasmuch as in view of the apex court decision in Raza Textiles Ltd. v/s Income Tax Officer, Rampur, - 2002-TIOL-872-SC-IT-LB the authority cannot confer jurisdiction upon itself by deciding a jurisdictional fact wrongly, the petitioner avers.
The petitioner submits that it is alleged that the yare providing 'Business Auxiliary Services', 'Business Support Services' in the sense that they were approaching the shipping lines/airlines only after getting inquiry from the client and, therefore, they were acting on behalf of the clients when they book the space or make available slots in the shipping lines / airlines. It is further submitted that the department has erroneously assumed that the arrangement creates a relationship of service provider and service recipient. The petitioner prays that there being no opportunity given to the Petitioner to first satisfy the authority about its jurisdiction and invite a ruling on this point, the Court should admit this Petition and direct the adjudicating authority to render a finding on jurisdiction and then allow the Petitioner, if need be, to challenge it in this very Writ Petition.
The High Court was not impressed with this argument of the petitioner.
Distinguishing the decision cited by the petitioner, the High Court further observed -
+ These allegations (in the SCN) may not be correct and that can be pointed out by the Petitioner by appearing before the Adjudicating Authority.
+ The Petitioner will have to demonstrate that it is not rendering any services within the meaning of Finance Act 1994, much less the 'business support services'.
+ It is the allegation in the show cause notice that the shipping lines / airlines are approached by the Petitioner–Assessee after getting inquiry from the clients and that is how the space or the slot is booked. That there is no such client who had approached the petitioner but the space is booked irrespective of any such inquiry from the client is a version of the Petitioner which the petitioner will have to establish and prove.
+ That there is no customer of the Petitioner and, therefore, the Petitioner is not an agent of such customer and hence whatever amounts are collected are not in the nature of service charge, are all matters which raise essentially disputed questions of fact.
+ The Petitioner will have ample opportunity before the Adjudicating Authority to urge that the jurisdictional facts have been wrongly assumed and that is why the show cause notice could not have been issued at all and that the services for which registration was obtained are not the same but distinct.
+ All such contentions can be raised and we cannot proceed on the basis that the Adjudicating Authority will not deal with them. We cannot assume that the petitioner will necessarily be served with an adverse order. In such a situation, we cannot entertain this Petition. In the given facts and circumstances, this is nothing but scuttling the inquiry and delaying the adjudication.
Holding that there is no merit in the petition, the same was dismissed.
(See 2015-TIOL-2118-HC-MUM-ST)
