Gujarat High Court
Gopala Builders vs Directorate General Of Central Excise ... on 9 June, 2015
Bench: Vijay Manohar Sahai, R.P.Dholaria
C/SCA/8704/2015 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
SPECIAL CIVIL APPLICATION NO. 8704 of 2015
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GOPALA BUILDERS....Petitioner
Versus
DIRECTORATE GENERAL OF CENTRAL EXCISE INTELLIGENCE &
1....Respondents
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Appearance :
MR. JAIMIN R DAVE, ADVOCATE WITH MR ROHAN H MATHEW, ADVOCATE
for the Petitioner.
MR HRIDAY BUCH, CENTRAL GOVERNMENT STANDING COUNSEL appearing
for the Respondents.
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CORAM: HONOURABLE THE ACTING CHIEF JUSTICE
MR. VIJAY MANOHAR SAHAI
and
HONOURABLE MR.JUSTICE R.P.DHOLARIA
Date : 09/06/2015
ORAL ORDER
(PER : HONOURABLE THE ACTING CHIEF JUSTICE MR. VIJAY MANOHAR SAHAI) Rule. Mr. Hriday Buch, learned Central Government Standing Counsel waives service of rule for respondents.
Learned counsel Mr. Hriday Buch has placed on record copy of affidavit-in-reply. Mr. Jaimin R. Dave, learned counsel appearing for the petitioner prays for one month's time to file affidavit-in-rejoinder.
The grievance of the petitioner is that without adjudicating the actual amount of service tax to be paid by the petitioner, on the assumed basis, service tax has been demanded by the respondents. According to learned counsel appearing for the respondents, the demand has been made as per the papers Page 1 of 3 C/SCA/8704/2015 ORDER submitted by the petitioner. If the papers have been seen by the respondents, then they should have adjudicated upon the matter and fixed the quantum of service tax which was liable to be deposited by the petitioner, if any.
It cannot be disputed that even before adjudication, the respondents could recover the amount. But on the assumed basis, the recovery which is being made that smacks with arbitrariness. The Division Bench of this Court in the case of Technomaint Contractors Limited v. Union of India, reported in 2014 (44) GST 545 (Guj.) = 2014 (36) STR 488 (Guj.) in paragraph 6 has held as under :-
"6...........All that we are suggesting is that when the show cause notice was issued by the department to which the petitioners have raised their objections, recoveries without adjudication of such disputed taxes was simply not permissible in law. We notice that Section 73C of the Finance Act, 1994 allows the department to make provisional attachment of the properties of the assessee during the pendency of the proceedings under Section 73 or 73A of the Act for the purpose of protecting the interest of the Revenue. Such provision cannot be activated for seeking recovery even before adjudication. Recovery of unpaid tax is to be made as per Section 87 of the said Act which provides for the power and procedure for such recoveries."Page 2 of 3 C/SCA/8704/2015 ORDER
In view of the above law laid down by the Division Bench of this Court, the petitioner is entitled for interim order. Till the next date of listing, the recovery proceedings initiated by the respondents against the petitioner shall remain stayed.
List on 13.7.2015.
(V.M.SAHAI, ACJ.) (R.P.DHOLARIA, J.) Savariya Page 3 of 3