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ST - Omission of Entry 92C from Union List - SCN demanding Service Tax after enactment of CGST Act, 2017 is prima facie without jurisdiction: HC

By TIOL News Service

GUWAHATI, DEC 19, 2017: THIS Writ Petition has been filed challenging the SCN dated 23.10.2017 issued by the respondent Assistant Commissioner of GST & Central Excise, Guwahati on the ground that after the enactment of the Central Goods and Services Tax Act, 2017 as well as the omission of Entry 92C from List-I of the Seventh Schedule of the Constitution, the respondent does not have any jurisdiction to enter into an enquiry in respect of the subject matter of the notice and as such the impugned SCN was wholly without jurisdiction. It is prayed that an order be passed suspending further proceeding pursuant to the SCN dated 23.10.2017.

The Central Government counsel submitted that he be granted some time to obtain instructions in the matter.

The High Court observed –

"Having regard to the pleadings in the Writ Petition, this Court is of the prima facie opinion that the impugned notice dated 23.10.2017 is without jurisdiction. In view of the above, further proceeding under the impugned notice is hereby stayed until the returnable date."

The Court directed issue of notice of motion returnable on 05.02.2018.

In passing:

Entry 92C of the Union listwas omitted by the the Constitution (One Hundred and First Amendment) Act, 2016, w.e.f.  16.9.2016.

Before, it read as - "92C. Taxes on services."

The Law:

Incidentally, in our DDT column we had carried an interesting and exhaustive analysis on the subject "What is the constitutional authority for levy of Service Tax?" and by citing the Supreme Court decision in  2010-TIOL-87-SC-ST-LB   concluded - Service Tax is levied under the residual entry 97 of the Seventh Schedule to the Constitution and not under entry 92C, as strongly believed by many.

(See 2017-TIOL-2603-HC-GUW-ST)


 RECENT DISCUSSION(S) POST YOUR COMMENTS
   
 
Sub: levy of Service tax

it is a fact that though entry 92C was entered in to seventh schedule but same was never notified and thus had no effect. in several case it has been held by apex court that service tax was levied under entry 97 and not under 92C.

Posted by Satya Narain
 

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