2016 (4) TMI 69 - HC - Service Tax

Seeking extension of time to comply with earlier order and direction - Auction and sale of Aircraft - Authorities realise after a long time that technical services and expert assistance are also required to undertake an auction of aircraft - No steps are taken after the last order passed by this Court - Unsatisfactory to the response that the entire Commissionerate are unaware of the steps that would be required to be taken for conducting an auction of the Aircraft and they have considered this to be any other or routine sale - Held that - in India when the Aircraft carriers particularly the national carrier acquire a Aircraft on lease or on outright purchase basis they definitely have technical backup and expert teams with whose assistance the aircrafts would be surveyed and approved and thereafter the deals finalised. Such a mechanism is available in India with two entities i.e. Air India and M/s.Air Work Engineering Pvt.Ltd It is not understandable that why the Service Tax Commissioner or the deponent of this affidavit has not till today bothered to verify from these entities whether they are ready and willing to offer their services and if so willing on what terms and conditions. He should have immediately taken up the issue with them and thereafter got in touch with his Superiors and instead of the usual process straightway engaged these entities on commercial terms. The Air India s Engineering unit or department can definitely assist the Service Tax Commissioner. But this order and direction does not mean that any of the terms and conditions in the earlier orders are relaxed. - Matter disposed of

Summary

Issues: Compliance with court orders regarding auction of Aircraft

Analysis:
1. The court noted that the order and direction given earlier had not been complied with. The Commissioner of Service Tax-V, Mumbai Commissionerate, sought an extension of time to comply with the court's order through an application supported by an affidavit.
2. The court reviewed the application and the supporting affidavit presented by the Commissioner.
3. After examining the Affidavit of the Additional Commissioner of Service Tax-V, the court expressed dissatisfaction with the steps taken so far.
4. The court emphasized the need for technical services and experts for the auction of the Aircraft parked in Mumbai. It criticized the lack of action taken by the authorities in charge of the auction.
5. The Service Tax Commissioner was supposed to decide on the modalities of the auction and conduct it. However, the court was not satisfied with the response provided, as it appeared that the Commissionerate was unaware of the necessary steps for conducting such a specialized auction.
6. The court highlighted that entities like Air India and M/s.Air Work Engineering Pvt.Ltd. have the technical expertise required for such auctions. It questioned why the Service Tax Commissioner had not engaged with these entities to secure their services.
7. The court directed the Commissioner to explore the possibility of engaging these expert entities and report back to the court. The matter was listed for further consideration after three weeks.
8. It was clarified that the court's order did not relax any terms and conditions set in earlier orders.
9. The court instructed the Commissioner to communicate the order to the relevant authorities in the Department of Revenue and the Central Board of Excise and Customs.
10. The case was scheduled to be heard again after three weeks, with pending motions to be addressed at that time.

This detailed analysis of the judgment highlights the court's concerns regarding the lack of compliance with its orders and the need for specialized technical expertise in conducting the auction of the Aircraft. The court emphasized the importance of engaging expert entities like Air India and M/s.Air Work Engineering Pvt.Ltd. for the successful execution of the auction process. The Commissioner was directed to take immediate steps to secure the required services and report back to the court within the specified timeline.