By TIOL News Service

CHENNAI, JAN 07, 2016: ASSESSEE, a manufacturer of GRP pipes, received Rs.5,19,45,145/- towards labour charges for installation and commissioning of GRP Pipes during the period from 01.07.2003 to 31.10.2004. Demand of Service tax was raised under Erection, Commissioning or Installation Services in Order-in-Original dated 20.11.2006. Instead of filing a regular appeal, the Appellant filed a writ petition in Year 2006 and the High Court in Year 2011 held on merits that the demand was unsustainable. Aggrieved the Revenue filed Writ Appeal in Year 2011.

Revenue argued that assessee has an effective alternative remedy of appeal and so writ petition ought not to have been entertained by the learned Single Judge. However, the Court held that it is not in every case that this Court would entertain a writ petition and it is only in the rarest of rare cases that this Court would allow the assessee to bypass the alternative remedy of appeal. Court noted that the Order-in-Original is dated 20.11.2006 and writ petition was filed way back in December 2006 and it was eventually allowed by a learned Judge on 08.08.2011. The court noted that a total period of 9 years has passed from the date of the order-in-original. The Court held that it would be futile to set aside the order of the learned judge and to dismiss the writ petition on the ground of availability of alternative remedy at this distance of time. Accordingly Court rejected the contention of alternative remedy.

On merits, the court found that assessee was engaged only in the business of laying down pipelines and the same would not come within the purview of the expression "plant, machinery or equipment" so as to attract the provisions of Section 65(29) of the Finance Act, 2003, for the period from 01.07.2003 to 31.10.2004.