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2016 (7) TMI 874 - GUJARAT HIGH COURT

2016 (7) TMI 874 - GUJARAT HIGH COURT - 2016 (46) S.T.R. 16 (Guj.) - Levy of VAT and Service tax both on Supply of tangible goods service - Section 65(105)(zzzzj) of the Finance Act, 1994 - demand of service tax on lease charges received by the assessee - Held that:- Merely because the petitioner argues that not service tax but value added tax would be leviable since the title in the property does not pass on to the lesee would not be a ground to hold that the tax authorities cannot examine and .....

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ion is not entertained leaving it open for the petitioner to pursue statutory remedy. - SPECIAL CIVIL APPLICATION NO. 10560 of 2016 - Dated:- 13-7-2016 - MR. AKIL KURESHI AND MR. A.J. SHASTRI, JJ. FOR THE PETITONER : MR ANAND NAINAWATI, ADVOCATE ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. The petitioner has challenged order-in-original dated 20.01.2016 passed by the Principal Commissioner of Service Tax, Ahmedabad, under which, he has confirmed the proposal in the show-cause notice .....

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in-original, statutory appeal lies before the CESTAT. Admittedly, no such appeal has been filed by the petitioner. It is equally admitted that, against the order of CESTAT, a further tax appeal would be available to the High Court on a substantial question of law. In other words, despite availability of statutory appellate remedy, the petitioner has approached the High Court in this writ petition without first availing such alternative statutory appellate remedy. In this context, we, at the outs .....

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nd that, therefore, it would be open for the petitioner to approach the High Court directly in a writ petition in order to press the question of very jurisdiction of the authority. He lastly contended that, the important question of interpretation of constitutional provisions is involved in the petition and therefore also, the writ petition should be entertained ignoring availability of alternative remedy. In this context, counsel submitted that the petitioner has created a lease in a movable pr .....

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not efficacious or speedy or that on certain well laid down exceptions carved out by series of judgements of Supreme Court and the High Court, the Court would be persuaded to permit the petitioner to pursue the writ petition directly without insisting on filing the appeal as provided under the statute. 5. In this context, we may refer to the decision of Supreme Court in case of Commissioner of Income Tax and ors vs. Chhabil Dass Agarwal reported in 357 ITR 357, in which, the Court referring to l .....

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mental principles of judicial procedure or has invoked provisions which are repealed or when an order has been passed in total violation of the principles of natural justice, the proposition that the High Court will not entertain a petition under Article 226 of the Constitution if an effective alternative remedy is available or statute under which the action complained of has been taken itself contains a mechanism for redressal of grievance still holds the field. We may reproduce the relevant po .....

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26 despite the existence of an alternative remedy. However, the High Court must not interfere if there is an adequate efficacious alternative remedy available to the petitioner and he has approached the High Court without availing the same unless he has made out an exceptional case warranting such interference or there exist sufficient grounds to invoke the extraordinary jurisdiction under Article 226. (See: State of U.P. vs. Mohammad Nooh, AIR 1958 SC 86; Titaghur Paper Mills Co. Ltd. vs. State .....

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are repealed, or when an order has been passed in total violation of the principles of natural justice, the proposition laid down in Thansingh Nathmal case, Titagarh Paper Mills case and other similar judgments that the High Court will not entertain a petition under Article 226 of the Constitution if an effective alternative remedy is available to the aggrieved person or the statute under which the action complained of has been taken itself contains a mechanism for redressal of grievance still .....

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igh Court under Article 226 of the Constitution when he had adequate remedy open to him by an appeal to the Commissioner of Income Tax (Appeals). The remedy under the statute, however, must be effective and not a mere formality with no substantial relief. In Ram and Shyam Co. vs. State of Haryana, (1985) 3 SCC 267 this Court has noticed that if an appeal is from Caesar to Caesar s wife the existence of alternative remedy would be a mirage and an exercise in futility. In the instant case, neither .....

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ess or otherwise of the notices issued under Section 148 of the Act, the re-assessment orders passed and the consequential demand notices issued thereon. 6. Bearing in mind these observations of the Supreme Court, we would be most reluctant to allow the petitioner to bypass the statutory mechanism provided for dispute resolution. 7. Learned counsel for the petitioner, however, placed heavy reliance on the decision of Supreme Court in case of Bharat Sanchar Nigam Ltd vs. Union of India reported i .....

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questions relating to the competence of the States to levy sales tax on telecommunication service which was an issue which could not have been raised and decided by the Assessing authorities. This is not the scenario in the present case. Merely because the petitioner argues that not service tax but value added tax would be leviable since the title in the property does not pass on to the lesee would not be a ground to hold that the tax authorities cannot examine and entertain such a contention t .....

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ed to the facts of the case as can be seen from following observations of the Supreme Court to which heavy reliance was placed by the Counsel for the petitioner: Hanumantappa Jamkhandi v. The Union of India and another (1). In Ramjilal s case (2), this Court held that the protection against imposition and collection of tax save by authority of law directly arises from Art. 265 and is not secured by cl. 1 of Art. 31 ; and Art. 265 not being in Ch. III of the Constitution, its protection is not a .....

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