Gujarat High Court
Sanjoo Prints Private Limited vs Union Of India on 3 January, 2022
Author: J.B.Pardiwala
Bench: J.B.Pardiwala
C/SCA/19022/2021 ORDER DATED: 03/01/2022
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 19022 of 2021
==========================================================
SANJOO PRINTS PRIVATE LIMITED
Versus
UNION OF INDIA
==========================================================
Appearance:
MR.AVINASH PODDAR(9761) for the Petitioner(s) No. 1
for the Respondent(s) No. 1,2,3,4,5,6
==========================================================
CORAM:HONOURABLE MR. JUSTICE J.B.PARDIWALA
and
HONOURABLE MS. JUSTICE NISHA M. THAKORE
Date : 03/01/2022
ORAL ORDER
(PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA)
1. By this writ-application under Article 226 of the Constitution of India, the writ-applicant has prayed for the following reliefs:-
28(A) To issue a writ of mandamus or any other appropriate writ, quashing and setting aside the impugned order-in-original dated 28.09.2021, show-cause notice dated 29.09.2020 & 30.12.2020 for FY 20145-15 and FY 2015-16 respectively and pre-consultation notice dated 22.09.2021 which have been issued without application of mind and are absolutely arbitrary;
OR ALTERNATIVELY To issue a writ of mandamus or any other appropriate writ, directing the Respondent No.6 to allow the waiver of pre-deposit on merits to file appeal and stay on the impugned demand.
(B) To issue a writ of mandamus or any other appropriate writ, order or directions, directing the Respondent No.3 i.e. The Principal Commissioner to look into the said matter and review all such notices being issued arbitrarily without application of mind and further quash the said notices for the convenience of the honest taxpayers.
(C) To issue a writ of mandamus or any other appropriate writ, Page 1 of 6 Downloaded on : Wed Jan 12 16:21:45 IST 2022 C/SCA/19022/2021 ORDER DATED: 03/01/2022 order or directions, as an ad-interim relief, not to take any coercive measure and any other relief as the Hon'ble Court deems fit;
(D) To provide any other relief in relation to above prayers as Hon'ble Court deems fit;
(E) To award costs fo and incidental to this application be paid by the respondents;
2. It appears from the materials on record that the writ-applicant herein is engaged in the business of 'dyeing and printing of textile articles' i.e. providing job work service in the textile industry. It is the case of the writ-applicant that the services, which are being provided are exempted vide the Entry No.30 of the Notification No.25/2012-ST from the applicability of the Service Tax and is also exempted from the Excise Duty vide the General Exemption No.21 and Notification No.214-1986-CE dated 25.03.1986. According to the writ-applicant, it being a private limited company at the most is liable to pay Service Tax on the Reverse Charge Mechanism on the basis of receiving some services such as Goods Transport Agency Service, Legal Services etc.,
3. The writ-applicant was served with two show-cause notices dated 29.09.2020 with respect to F.Y.2014-15 and dated 30.12.2020 with respect to F.Y. 2015-16 respectively. In the show-cause notice dated 29.09.2020, the writ-applicant was called upon to show-cause on the following:-
"11. Therefore, M/s. Sanjoo Prints Private Limited, Plot No.291, GIDC Sachin, Surat, Gujarat is hereby called upon to show cause to the Joint Commissioner having their office at 3 rd Floor, CGST & CE Bhavan, Chowk Bazar, Opposite Gandhi Bagh, Surat Commissionerate, Surat as to why:
i) Service Tax amounting to Rs.1,14,38,757/- (including Cess) Page 2 of 6 Downloaded on : Wed Jan 12 16:21:45 IST 2022 C/SCA/19022/2021 ORDER DATED: 03/01/2022 towards taxable service "Goods Transport Agency" provided by them during the period of the year 2014-15, should not be demanded and recovered from them under proviso to sub-
section (1) of Section 73 of the Finance Act, 1994 by invoking the extended period of limitation.
ii) Interest at the applicable rate under Section 75 of the Finance Act, 1994 should not be demanded and recovered from them from the due date on which the Service Tax was liable to be paid till the date on which said Service Tax is paid.
iii) Penalty should not be imposed upon them under Section 78(1) of the Finance Act, 1994 (as amended) for non-payment/ short payment of Service Tax by suppressing the facts and taxable value with intention to evade payment of Service Tax.
iv) Penalty should not be imposed upon them under Section 77[1][c][i] & 77[1][c][ii] of the Finance Act, 1994 for non furnishing of information and non production of documents respectively."
4. It is not in dispute that the writ-applicant filed a detailed reply to the aforesaid show-cause notice. Same is the case with the second show-cause notice. Ultimately, a final common order, dated 28.09.2021 came to be passed with respect to both the show-cause notices. The order with respect to both the show-cause notices reads thus:-
ORDER (A) In respect of Show Cause Notice bearing F.No.XII/36/SCN/OA/2020 dated 29.09.2020, I hereby pass the following order:
1. I determine and confirm the demand of Service Tax amounting to Rs.1,14,38,757/- [Rupees One Crore Fourteen Lakhs Thirty Eight Thousand Seven Hundred and Fifty Seven Only] (inclusive of Cesses) and order to recover the same from M/s. Sanjoo Prints Private Limited, Plot No.291, GIDC Sachin, Surat, Gujarat, under the provisions of Section 73(2) of the Finance Act, 1994.Page 3 of 6 Downloaded on : Wed Jan 12 16:21:45 IST 2022
C/SCA/19022/2021 ORDER DATED: 03/01/2022
2. I confirm the demand of interest, at the appropriate rate, on Rs.1,14,38,757/- (Rupees One Crore Fourteen Lakhs Thirty Eight Thousand Seven Hundred and Fifty Seven Only) (inclusive of Cesses) as stated in (1) above and order to recover the same from M/s. Sanjoo Prints Private Limited, Plot No.291, GIDC Sachin, Surat, Gujarat, under Section 75 of the Finance Act, 1994.
3. I impose penalty of Rs.1,14,38,757/- (Rupees One Crore Fourteen Lakhs Thirty Eight Thousand Seven Hundred and Fifty Seven Only) upon M/s. Sanjoo Prints Private Limited, Plot No.291, GIDC Sachin, Surat, Gujarat under Section 78 of the Finance Act, 1994. However, if the service tax as determined at (1) above and applicable interest thereon is paid within a period of 30 days of the date of the receipt of this order, the penalty payable shall stand reduced to 25% of the service tax determined as at (1) above, subject to the condition that such reduced penalty is also paid within 30 days of the receipt of this order in terms of provisions as contained in clause (ii) of second proviso to Section 78(1) of the Finance Act, 1994.
4. I impose penalty of Rs.10,000/- (Rs. Ten Thousand Only) upon M/s. Sanjoo Prints Private Limited, Plot No.291, GIDC Sachin, Surat, Gujarat separately under Sections 77(1)(c)(i) and 77(1)(ii) of the Finance Act, 1994 for non-furnishing of information and for non-production of documents respectively.
(B) In respect of show-cause notice bearing F.No.XII/125/ADJ-JC/CR/ 2020-2021 dated 30.12.2020, I hereby pass the following order:-
1. I determine and confirm the demand of Service Tax amounting to Rs.1,88,20,636/- (Rupees One Crore Eighty Eight Lakhs Twenty Thousand Six Hundred and Thirty Six Only) and order to recover the same from M/s. Sanjoo Prints Private Limited, Plot No.291, GIDC Sachin, Surat, Gujarat under the provisions of Section 73(2) of the Finance Act, 1994.
2. I confirm the demand of interest, at the appropriate rate, on Rs.1,88,20,636/- (Rupees One Crore Eighty Eight Lakhs Twenty Thousand Six Hundred and Thirty Six Only) as stated in (1) above and order to recover the same from M/s.
Sanjoo Prints Private Limited, Plot No.291, GIDC Sachin, Page 4 of 6 Downloaded on : Wed Jan 12 16:21:45 IST 2022 C/SCA/19022/2021 ORDER DATED: 03/01/2022 Surat, Gujarat under Section 75 of the Finance Act, 1994.
3. I impose penalty of Rs.1,88,20,636/- (Rupees One Crore Eighty Eight Lakhs Twenty Thousand Six Hundred and Thirty Six Only) upon M/s. Sanjoo Prints Private Limited, Plot No.291, GIDC Sachin, Surat, Gujarat under Section 78 of the Finance Act, 1994. However, if the service tax as determined at (1) above and applicable interest thereon is paid within a period of 30 days of the date of the receipt of this order, the penalty payable shall stand reduced to 25% of the service tax determined as at (1) above, subject to the condition that such reduced penalty is also paid within 30 days of the receipt of this order in terms of provisions as contained in clause (ii) of second proviso to Section 78(1) of the Finance Act, 1994.
4. I impose penalty of Rs.10,000/- (Rs. Ten Thousand Only) upon M/s. Sanjoo Prints Private Limited, Plot No.291, GIDC Sachin, Surat, Gujarat separately under Sections 77(1)(c)(i) and 77(1)(c)(ii) of the Finance Act, 1994 for non-furnishing of information and for non-production of documents respectively.
5. I impose penalty of Rs.10,000/- (Rs. Ten Thousand Only) upon M/s. Sanjoo Prints Private Limited, Plot No.291, GIDC Sachin, Surat, Gujarat under Section 77(2) for filing incorrect details in the ST-3 returns filed by them.
25. This Order is issued without prejudice to any other action that may be taken against the assessee under the Finance Act, 1994 and the rules framed there under or under any other law for the time being in force. This order is governed under Section 174 & 142 of CGST Act, 2017.
5. Being dissatisfied with the aforesaid common order passed by the Joint Commissioner, Central GST & Central Excise, Surat Commissionerate, the writ-applicant is here before this Court with the present writ-application.
6. Manifold contentions have been raised by Mr. Poddar, the learned counsel appearing for the writ-applicant.
Page 5 of 6 Downloaded on : Wed Jan 12 16:21:45 IST 2022C/SCA/19022/2021 ORDER DATED: 03/01/2022
7. We do not propose to go into the merits of all such contentions as we are of the view that the impugned order is appeal-able under Section-73 of the GST Act read with Section-84 of the Finance Act.
8. There is no good ground made out to directly entertain this writ-application questioning the legality and validity of the order in original. It prima-facie appears from the reliefs prayed for that if an appeal is filed, then towards pre-deposit the writ-applicant is obliged to deposit 7.5% of the total demand. This may be a little difficult for the writ-applicant but that by itself is not sufficient for this Court to entertain this writ-application, more particularly, when there is an alternative remedy of statutory appeal being available to the writ-applicant.
9. We decline to entertain this writ-application on the above short ground alone with liberty to the writ-applicant to prefer an appropriate statutory appeal. If ultimately an appeal is filed, it shall be open for the writ-applicant to raise all the legal contentions before the appellate authority as raised before us in this writ- application. If any application is filed for waiver of the pre-deposit, the same may also be considered expeditiously in accordance with law.
10. With the aforesaid, this writ-application stands disposed of.
(J. B. PARDIWALA, J) (NISHA M. THAKORE,J) A. B. VAGHELA Page 6 of 6 Downloaded on : Wed Jan 12 16:21:45 IST 2022