quashed exercise of writ jurisdiction
Case Title | Gayatri Educational & Charitable Trust vs Central Board of Excise & Customs and Others |
Court | Orissa High Court |
Honorable Judges | Justice Jaswant Singh & Justice M.S.Raman |
Citation | W.P.(C) No.5582 of 2022 2022 (4) GSTPanacea 330 HC Orissa |
Judgement Date | 21-April-2022 |
Council for Petitioner | Jagamohan Pattanaik |
Council for Respondent | Radheshyam Chimanka |
Section | Section 70 of the CGST Act 2017 |
In Favour of | In Favour of Respondent |
The Orissa High Court bench of Justice Jaswant Singh & Justice M.S.Raman has held that unless it is shown that the notice to show cause has been issued palpably without any authority of law, the show cause notice cannot be quashed in exercise of writ jurisdiction under Articles 226 and 227 of the Constitution.
FACTS OF THE CASE
Petitioner claims to be an Educational and Charitable Trust and carries on educational activities.
On 27th October, 2020, search operation was conducted by the Officers of Directorate General of Goods and Services Tax Intelligence, Bhubaneswar Zonal Unit, Bhubaneswar (DGGI) at the residential premises of M/s. Gayatri Educational and Charitable Trust.
In exercise of powers conferred under section 67 of the CGST Act, certain documents were seized during search operation. On the said date i.e. 27th October, 2020, summons under section 70 of the Central Goods and Services Tax Act, 2017 has been issued to carry out the inquiry in the matter, whereby the Trustee of the Petitioner-Trust, namely, Sushant Kumar Rout was instructed to be present on 5.11.2020 to give evidence and/or to produce the following documents in his possession or his control:
On 6th November, 2020, another summons was issued to the said Trustee to be present on 16th November, 2020 in connection with service tax under Finance Act, 1994 and Central Goods and Services Tax Act, 2017 and the said Trustee was required to give evidence and also to produce the documents:
On 28th/ 29th December, 2020, a show cause notice was issued narrating fact that the Petitioner-Trust was engaged in providing taxable service under the category of “Commercial Training or Coaching” Service through a Coaching Centre in the name of “LIT” without getting itself registered under Section 69 of the Finance Act, 1994 and said show cause notice indicated that after initiation of investigation by DGGI, Gayatri Educational and Charitable Trust-Petitioner registered itself vide Service Tax Code AACTG0062ASE001 for coaching premises. By the said show cause notice, the Petitioner was called upon to show cause as to why the following action shall not be taken
Service Tax of Rs.65,35,000/- Education Cess of Rs.21,167/-, Secondary and Higher Education Cess of Rs.10,583, Swachh Bharat Cess of Rs.1,56,560/-& Krishi Kalyan Cess of Rs.1,31, 550/- total amounting Rs.68,54,859/-(Rupees Sixty Eight Lakh Fifty Four Thousand Eight Hundred Fifty Nine) only, not paid should not be demanded and recovered from them under the proviso to Section 73(1) of the Finance Act, 1994 read with Sections 91 and 95 of the Finance (No.2) Act, 2004 and Sections 136 & 140 of the Finance Act 2007
Counsel for the Petitioner submitted that though he has produced required documents as called for earlier in connection with show cause notice dated 28th/29th December, 2020, the Authority should not have issued frequent summons including summons dated 15.02.2022 (Annexure-13), causing thereby ‘mental agony and ‘tremendous pressure’ on the Petitioner-Trustee
Petitioner contended that the service which it renders has been put under the negative list during the service tax regime and its educational activities do not fall within the purview of the GST Act.
quashed exercise of writ jurisdiction
COURT HELD
Considering the facts as recorded, held that law is well settled that unless it is shown that the notice to show cause has been issued palpably without any authority of law, the show cause notice cannot be quashed in exercise of writ jurisdiction under Articles 226 and 227 of the Constitution
The Petitioner is required to file its response to the show-cause notice and raise objection before the authority.
In view of the above, this Court does not deem it fit to interfere with the process of inquiry by the Competent Authority Opposite Parties
Accordingly, the writ petition is disposed of with the observation that it is open for the Petitioner to participate in the proceeding before the Opposite Parties
quashed exercise of writ jurisdiction
ANALYSIS OF THE JUDGEMENT
Whether the activities undertaken by the Petitioner attract Service Tax under the Finance Act, 1994 and are exigible to GST under the Central Goods and Services Tax Act, 2017 are disputed question of facts which are necessarily to be adjudicated upon by the authorities vested with the power under the relevant statute.
As regards application dated 12.12.2021 (Annexure-12) for supply of documents is concerned, as stated by the counsel for the Petitioner to have been pending before the authority, the appropriate authority is competent to decide the same in accordance with law.
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Gayatri Educational & Charitable Trust
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