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TMI Blog2013 (12) TMI 1639X X X X Extracts X X X X X X X X Extracts X X X X ..... had availed services of M/s. Ashish Enterprises (hereinafter referred to as "service provider") for the purpose of supplying manpower in the factory of the petitioner for various purposes like loading, unloading, packaging, housekeeping etc. For the aforesaid purpose, petitioner entered into a contract with the service provider inclusive of the contract for the disputed period. It is also required to be noted at this stage that even as on today the service provider is supplying the manpower/labourers to the petitioner. That an amount of more than Rs. 2 crores is due and payable by the petitioner to the service provider for supply of manpower etc., to the petitioner. It appears that an amount of Rs. 38,27,023/ for the period from April 2011 to September 2012 is due and payable by the service provider to the department/Revenue towards the Service Tax, education cess etc. By impugned communication dated 12-10-2012 the petitioner is called upon/directed to pay up the Service Tax of Rs. 38,27,023/ due and payable by the service provider to the department/Revenue, for the period from April 2011 to September 2012. 2.2 Feeling aggrieved and dissatisfied with the impugned co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be sustained as there is a dispute between the petitioner and the service provider and as such it cannot be said that approximately more than Rs. 2 crores is due and payable by the petitioner to the service provider. It is submitted that therefore when the amount due and payable by the petitioner to the service provider is disputed, the department cannot be permitted to recover the amount of Service Tax due and payable by the service provider in exercise of powers under Section 87 of the Act, from the amount due and payable by the petitioner to the service provider, which is disputed. It is submitted that as such against the total bills of Rs. 6.24 crores raised by the service provider, petitioner has already paid a sum of Rs. 4.07 crores and the balance amount is not paid as the same is disputed. It is submitted by Shri Parikh, learned Counsel appearing on behalf of the petitioner that as such amount of Rs. 2 crores is not due and payable by the petitioner to the service provider. It is submitted that as the petitioner does not believe that amount of Rs. 2 crores is payable by the petitioner to the service provider, the department has to accept the same. According to Shri Parikh, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w of Section 22 of SICA. It is submitted that therefore it is not open for the Revenue to collect the amount from the petitioner, which otherwise even the service provider may not recover by way of suit or company petition. Making above submissions and relying upon above decisions, it is requested to allow the present special civil application. 4. Present petition is opposed by Shri R.J. Oza, learned Counsel appearing on behalf of the respondent - revenue/department. It is submitted that as such approximately more than Rs. 2 crores is due and payable by the petitioner - recipient of service to the service provider. It is submitted that as such it was never the case on behalf of the petitioner that there was any dispute between the petitioner and the service provider and even the amount of approximately more than Rs. 2 crores, due and payable by the petitioner to the service provider is disputed. It is submitted that as such no material and/or evidence has been produced on record to suggest that there is any dispute that at any point of time there was any dispute with respect to the amount due and payable by the petitioner to the service provider. It is submitted that even in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fter the petitioner had approached the BIFR. It is submitted that as such the petitioner is running company which had availed the service by the service provider for the period after the petitioner had approached the BIFR and therefore, the bar under Section 22 of SICA would not be applicable. Shri Oza, learned Counsel appearing on behalf of the Revenue has heavily relied upon the decision of the Hon'ble Supreme Court in the case of Deputy Commercial Tax Officer v. Corromandal Pharmaceuticals reported in AIR 1997 SC 2027. 4.4 Now, so far as the reliance placed upon the decision of the Hon'ble Supreme Court in the case of Raheja Universal Limited (supra) and decision of this Court in the case of Core Healthcare Ltd. (supra) as well as decision of Andhra Pradesh High Court in the case of Bharat Heavy Plate & Vessels Ltd. (supra) is concerned, it is submitted that on facts the said decisions would not be applicable to the facts of the case on hand. Making above submissions and relying upon above decision, it is requested to dismiss the present petition. 5. Heard learned Counsel appearing on behalf of the respective parties at length. At the outset it is required to be not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ately more than Rs. 2 crores due and payable by the petitioner to the service provider. As observed hereinabove, only with a view to get out of the provisions of Section 87 of the Act and as an afterthought now the petitioner has come out with a case that amount of Rs. 2 crores is not due and payable by the petitioner to the service provider and there is a dispute between the petitioner and the service provider. It is also required to be noted at this stage that even today the service provider is supplying the labour/manpower to the petitioner. In light of the aforesaid facts and circumstances, the applicability of Section 87 of the Act and the impugned demand notice is required to be considered. Section 87 of the Act provides for recovery of any amount of Service Tax etc., due to the Central Government. Section 87 of the Act reads as under: 87. "Recovery of any amount due to Central Government. Where any amount payable by a person to the credit of the Central Government under any of the provisions of this Chapter or of the rules made thereunder is not paid, the Central Excise Officer shall proceed to recover the amount by one or more of the modes mentioned below :- ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Excise Officer may prepare a certificate signed by him specifying the amount due from such person and send it to the Collector of the district in which such person owns any property or resides or carries on his business and the said Collector, on receipt of such certificate, shall proceed to recover from such person the amount specified thereunder as if it were an arrear of land revenue.]" 5.1 Considering the provision of Section 87 of the Act when any amount payable by a person to the credit of the Central Government is not paid, the Central Excise Officer shall proceed to recover the amount by one or more of the modes mentioned in Section 87 of the Act and as per Section 87(b)(i) of the Act, the Central Excise Officer may, by notice in writing, require any other person from whom money is due or may become due to such person, or who holds or may subsequently hold money for or on account of such person, to pay to the credit of the Central Government either forthwith upon the money becoming due or being held or at or within the time specified in the notice, not being before the money becomes due or is held, so much of the money as is sufficient to pay the amount due from suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cision of this Court in the case of Core Healthcare Ltd. (supra) as well as decision of Andhra Pradesh High Court in the case of Bharat Heavy Plate & Vessels Ltd. (supra) is concerned, in the facts and circumstances of the case, there shall not be any bar of recovery of amount of Service Tax from the petitioner which is for the period after the petitioner had approached the BIFR. At the outset it is required to be noted that as such the petitioner is a running concern and has availed the services of the manpower/labourers from the service provider for the period after the petitioner had approached the BIFR and the Service Tax dues in question is for the period after the petitioner had approached the BIFR. Therefore, when the petitioner had availed the service of labourers/manpower subsequent to approaching the BIFR and is a running company and the impugned liability of Service Tax is for the period after it approached the BIFR, bar under Section 22 of SICA would not be applicable. Under the circumstances, the decisions relied upon by the learned Counsel appearing on behalf of the petitioner would not be of any assistance to the petitioner and as such the said decisions would not be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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