Madras High Court
Indian Institute Of Architects vs Union Of India (Uoi) on 24 April, 2000
Equivalent citations: 2000(121)ELT609(MAD), 2006[2]S.T.R.295
Author: K.G. Balakrishnan
Bench: K.G. Balakrishnan
JUDGMENT N.V. Balasubramanian, J.
1. This is an appeal filed. against the order passed in W.P. No. 773 of 1999 dated 21-1-2000.
2. The appellant herein has filed the writ petition for the issue of a writ of declaration to declare some of the provisions of the Finance (No. 2) Act, 1998 and the Rules framed thereunder and the Finance Act, 1994 (Act 32 of 1994) as amended by Notifications issued thereunder levying service tax on the persons carrying on the profession of architecture as ultra vires of the Constitution of India. The writ petitioner is the Indian Institute of Architects, Prospects Chamber, Annexe, 5th Floor, Dr. D.N. Road, Fort, Mumbai, represented by its President.
3. This Court in W.P.M. No. 1028 of 1999 in W.P. No. 773 of 1999, by order dated 22-1-1999, granted interim stay of the operation of the relevant provisions of the Finance Act, 1994 (Act 32 of 1994). The petitioner herein has taken out a contempt application on the ground that the authorities in other States have not chosen to obey the interim order passed by this Court in W.M.P. No. 1028 of 1999 in W.P. No. 773 of 1999, dated 22-1-1999. When the contempt application came up for hearing before the learned Single Judge, a question arose regarding the maintainability of the writ petition. Learned Single Judge held that the petitioner has its registered Office at Mumbai and respondents 1, 2 and 4 are not amenable to the jurisdiction of this Court and the third respondent was impleaded only to maintain the writ petition. Learned Single Judge took the view that the petitioner is not a resident of Chennai, nor is it having its registered Office at Chennai or in any other places within the jurisdiction of this Court, and hence, the writ petition cannot be entertained by this Court. Accordingly, the writ petition was dismissed. Against the order passed in the writ petition, the writ appeal was filed by the appellant.
4. Mr. Arvind P. Datar, learned Counsel for the appellant submitted that Article 226 of the Constitution of India as amended by 15th and 44th amendments, this Court has jurisdiction when the cause of action or part of the cause of action has arisen within the jurisdiction of this Court and the residence of the appellant is of no consequence. According to the learned Counsel, the cause of action arose in Chennai itself where the impugned provisions of the Finance Act, 1998 are sought to be implemented in so far as they relate to the levy of service tax on Architects. Learned Counsel submitted that the appellant had a Chapter in Chennai apart from the fact that the President of the appellant is also from Madras and hence, the writ petition was properly filed before this Court. Learned Counsel strongly placed reliance on the decision of the Allahabad High Court in the case of Day a Shanker v. Chief of the Air Staff, New Delhi and the decision of the Bombay High Court in the case of S.N. Deshmukh v. The Medical Council of India and submitted that the cause of action has arisen by the action of the Government of India or its authorities in enforcing the provisions of an All India statute and the petitioner is aggrieved by such enforcement of its provisions on its members and hence, this Court has the jurisdiction to entertain the writ petition.
5. Mr. K. Veera Raghavan, learned Additional Central Government Standing Counsel appearing for the respondents supported the order of the learned Single Judge. He relied upon the decisions of the Supreme Court in the case of Laghu Udyog Bharati v. Union of India and CD. Security Services Network Ltd. v U.O.I. [2000 (1) SCALE 356] wherein the Supreme Court has upheld the levy of service tax on clearing and forwarding agents and goods transport operators.
6. We have carefully considered the submissions of the learned counsel for the appellant and the learned counsel for the respondents. No doubt, the question raised is interesting, however, we are of the view that the learned Judge was quite justified in taking the view that no part of the cause of action has arisen within the jurisdiction of this Court for the writ petitioner to maintain the writ petition. Admittedly, the petitioner is having its registered Office at Mumbai and respondents 1, 2 and 4 are not amenable to the jurisdiction of this Court, as they are stationed at New Delhi. The writ petition has not been filed by the Chennai Chapter of the Indian Institute of Architects questioning the levy of service tax in so far as it relates to the members carrying on the profession of architecture within the jurisdiction of this Court on the basis of the implementation of the provisions of the Service Tax against those architects. Admittedly, the appellant is having its members, at present, throughout India and the writ petition has not been filed challenging the levy of service-tax imposing service tax on the members carrying on the profession within the jurisdiction of this Court. The case of the appellant is that the levy of service-tax on the members residing outside the jurisdiction of this Court is also illegal. In our view, since the registered Office of the appellant is at Mumbai and respondents 1,2 and 4 are residing outside the jurisdiction of this Court, the third respondent has been impleaded only to show that a part of the cause of action has arisen within the jurisdiction of this Court in so far as the members of the appellant are concerned. We hold that this Court has no jurisdiction to entertain the writ petition.
7. Learned counsel for the appellant referred to Article 226 of the Constitution of India, particularly clause (2) or Article 226 and submitted that the cause of action has arisen in part within the jurisdiction of this Court and hence the writ petition is maintainable. The expression, "cause of action" in Article 226 was the subject matter of consideration by the Supreme Court in Oil & Natural Gas Commission v. Utpal Kumar Basu and the Supreme Court has held that the expression, cause of action means bundle of facts which the petitioner must prove, if traversed, to entitle him to a judgment in his favour by the Court. The Supreme Court has quoted with approval the following observations of Lord Watson in Chand Kour v. Partab Singh [ILR (1889)16 CAL.98&102]:-
"...the cause of action has no relation whatever to the defence which may be set up by the defendant, nor does it depend upon the character of the relief prayed for by the plaintiff. It refers entirely to the ground set forth in the plaint as the cause of action, or, in other words, to the media upon which the plaintiff asks the Court to arrive a conclusion in his favour."
The Supreme Court has held that in determining the objection as to the lack of territorial jurisdiction, the Court must take all the facts pleaded in support of the cause of action into consideration albeit without embarking upon an enquiry as to the correctness or otherwise of the said facts. In other words, when the question arises whether the Court has territorial jurisdiction or not to entertain the writ petition, it must be determined on the basis of the averments made in the writ petition and it is not necessary to go into the question of correctness of the statement made in the writ petition.
8. Applying the tests laid down by the Supreme Court in Oil & Natural Gas Commission's case, cited supra, it is seen from the affidavit filed in support of the writ petition that the petitioner has chosen to file the writ petition on the file of this Court on the basis that its President is a resident of Chennai. In our view, the residence of the President of the Indian Institute of Architects is not quite germane or is of no consequence in considering the question whether the cause of action or a part of the cause of action has arisen within the limits of the jurisdiction of this Court. No doubt, in the reply affidavit filed by the appellant, it has been stated that the petitioner in Tamil Nadu has a Chapter of the Indian Institute of Architects. However, the writ petition has not been filed by the Tamil Nadu Chapter of the Indian Institute of Architects espousing the cause of architects carrying on the profession within the jurisdiction of this Court. On the other hand, the writ petition, as already observed by us, is filed by the appellant challenging the levy of service-tax on all the members residing throughout the length and breadth of the country. We are of the view that if this Court entertains the writ petition, it may not be able to exercise effective control over the action, if any, done by the authorities exercising jurisdiction outside the outer territorial limits of this Court. As already observed, the appellant's registered Office is at Mumbai and the third respondent has been impleaded only to bring the cause within the jurisdiction of this Court.
9. The Supreme Court in the case of Union of India v. Oswal Woollen Mills Ltd. has observed that it is desirable that the writ petition should be filed in the High Court under whose jurisdiction the registered Office of the company is situate or where the company's principal officers reside, instead of a place where the cause of action has arisen.
10. In so far as the decisions relied upon by the learned counsel for the appellant are concerned, the decision of the Allahabad High Court in Daya Shankar's case is quite distinguishable as in that case no part of cause of action arose within the territorial limits of the Allahabad High Court and the Allahabad High Court held that the petitioner is not entitled to approach the Court to issue a direction to authority whose office is situate in Delhi. In so far as the decision of the Bombay High Court in S.N. Deshmukh's case [AIR 1988 Bombay 284] is concerned, it is seen, on the facts of the case, a part of the cause of action has arisen within the jurisdiction of the Bombay High Court and the Bombay High Court rightly held that the writ petition was entertainable by the Bombay High Court. We therefore hold that this Court has no territorial jurisdiction to entertain the writ petition and the learned Judge was quite justified in the view taken by him that the writ petition is not maintainable in law.
11. Learned counsel for the respondents relied upon the decisions of the Supreme Court in Laghu Udyog Bharati's case and CD. Security Services Network Ltd. case [2000 (1) SCALE 356]. Since we have held that the writ petition is not maintainable, it is not necessary to express our opinion on merits of the case.
12. The result is we affirm the judgment of the learned single Judge impugned in the writ appeal, and dismiss the appeal. However, in the facts and circumstances of the case, there will be no order as to costs. Consequently C.M.P. No. 2459 of 2000 is dismissed.