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2021 (7) TMI 1107 - HC - Service TaxValidity of SCN - Jurisdiction - demand of service tax on services provided or received which all are not exempted under the provisions of the Act - petitioner falling under the definition "service provider" so as to issue show cause notice with reference to certain services rendered by the petitioner, or not - HELD THAT:- This Court is of an opinion that the High Court is expected to be slow in entertaining a writ petition against a show cause notice. A writ against a show cause notice may be entertained only if the said notice is issued by an incompetent authority having no jurisdiction or if an allegation of malafides is raised. Even in case of raising an allegation of malafides, the authorities against whom such an allegation is raised, is to be impleaded as party respondent in his personal capacity. In all other circumstances, the allegations or counter allegations are to be adjudicated with reference to the evidences to be produced by the respective parties and such an exercise cannot be done in a writ proceedings under Article 226 of the Constitution of India. Thus, the High Court is expected to be cautious while entertaining a writ petition filed against the show cause notice. It is not in dispute between the parties that transmission and distribution of electricity are exempted from service tax. Question arises, what all are the services falling under the exemption clause and the other services which all are not covered under the exemption clause. The first respondent has specifically stated that they have issued the show cause notice only in respect of the services stated above, which all are not covered under the exemption clause under the Act. This Court is of the considered opinion that only if the exemption clause is applicable, then alone the jurisdiction point needs to be considered with reference to the facts of the present case. However, in the present case, the first respondent himself has categorically admitted both in the show cause notice as well as in the counter filed by them that specifically exemption is granted for transmission or distribution of electricity by any electricity transmission or distribution utility. The first respondent has made it clear that show cause notice has not been issued demanding service tax for transmission or distribution of electricity. The service tax are demanded only for other services which all are not covered under the exemption clause and therefore, these facts are to be adjudicated with reference to the documents and evidences. When there is a slightest doubt in respect of the point of jurisdiction is raised, then the benefit of the said doubt is to be given for the Revenue. This being the general principles in the present case and the petitioner is also an organisation owned by the State, the first respondent has issued the show cause notice with reference to the services which all are not covered in the exemption clause. The petitioners are directed to submit their explanations, documents and evidences along with legal submissions, if any, within a period of eight weeks from the date of receipt of a copy of this order - on receipt of the explanations from the petitioners, the concerned respondents are directed to proceed with the enquiry by affording opportunity to the petitioners, including personal hearing, as contemplated and complete the process and pass final orders as expeditiously as possible. If the petitioners are aggrieved from and out of the said final orders, to be passed thereafter, they are at liberty to approach the appellate authority for redressal of their grievances. Petition disposed off.
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