TMI Blog2019 (2) TMI 1497X X X X Extracts X X X X X X X X Extracts X X X X ..... ity of the circulars dated 06.08.2008 and 05.10.2015 is also in serious dispute. Further the classifiability of service rendered by a particular assessee is to be considered with reference to facts of each case depending upon nature of service rendered and the contract entered into. There cannot be any general declaration, as prayed for. We find force in the contention of the learned senior counsel, Sri Radhakrishnan, appearing for the appellants that the High Court has committed error in entertaining the writ petition under Article 226 of Constitution of India at the stage of show cause notices. Though there is no bar as such for entertaining the writ petitions at the stage of show cause notice, but it is settled by number of decisions of this Court, where writ petitions can be entertained at the show cause notice stage. Neither it is a case of lack of jurisdiction nor any violation of principles of natural justice is alleged so as to entertain the writ petition at the stage of notice. High Court ought not to have entertained the writ petition, more so, when against the final orders appeal lies to this Court. The judgment of this Court in the case of Deputy Commissioner, Cen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssociation, whose members are transport operators engaged in the business of transportation of goods entrusted by the customers. By way of impugned show cause notices, the appellants have proposed to demand service tax from the respondents under the category of cargo handling service , while it is the case of the respondents that the service which is being provided by them, falls under the taxable category of goods transport agency . The respondents, to bolster their case, have placed reliance upon circulars dated 06.08.2008 and 05.10.2015 issued by the Central Board of Excise and Customs (CBEC). Based upon the intelligence gathered by the officers of Rajkot Regional Unit, which revealed that several business entities including respondent nos.2 and 3 who are engaged in doing the business of cargo handling in west coastal region but had got themselves registered under good transport agency , by taking approval from the competent authorities, searches were conducted in the premises of respondent nos.2 and 3. It is alleged that during such searches several incriminating documents, including the quotations submitted by the respondentcompanies to their customers were seized and st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elates to classification of services and even if the show cause notices were to culminate into final order, appeal would lie before the Supreme Court, as such, High Court, in exercise of writ jurisdiction, should refrain from entertaining the petition which involves a classification dispute. It was pleaded that it was not either a case of lack of jurisdiction or a case where the principles of natural justice are violated, so as to entertain the petition in which only show cause notices were challenged. 8. On the other hand, it was the case of the respondent-original writ petitioners that there is no absolute prohibition for not maintaining the petition under Article 226 of the Constitution of India, even at the stage of show cause notice. It was their case that even taking the contents, as mentioned in the show cause notices, the contract does not amount to providing cargo handling service as defined under Entry 23 of Section 65 of the Act. By placing reliance on Circular No.B11/1/2002-TRU dated 01.08.2002 issued by the CBEC, it was the case of the respondents that cargo handling service means loading, unloading, packing or unpacking of cargo and includes cargo handling serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ambit of cargo handling service, inasmuch as the help from other service providers does not change the nature of service that is being provided by them. It was also stated that shipping lines raise bills in the name of respondents and if any service tax has been charged, the respondents would be within their rights to take cenvat credit of the same in accordance with the rules and regulations. However, that would not change the nature of services rendered by them. 11. While considering the contentions advanced on both sides, the High Court has over-ruled the objection of maintainability of the petition and has recorded a finding that the services rendered by the members of the respondent-association are classifiable under goods transport agency but not under cargo handling service . High Court has referred to the definition of cargo handling service under Section 65(23) of the Act, Circular No.B11/1/2002-TRU dated 01.08.2002 and by referring to the instructions dated 06.08.2008 issued in circular no.104/7/2008-S.T. and circular bearing no.186/5/2015-S.T. dated 05.10.2015, has held that even after introduction of new regime w.e.f. 01st July 2012, the activity of the resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. Learned senior counsel, Sri Radhakrishnan, appearing for the appellants has submitted that the High Court has committed a serious error in entertaining the petition which itself is directed against the show cause notices. It is submitted that as the issue relates to classifiability for the purpose of taxation, more so, against the final order, appeal is provided to the Supreme Court, High Court ought not to have entertained the writ petition at all. It is further submitted that once the respondents undertook the responsibility of delivery of goods from consignor to consignee and more particularly when they are also providing cargo handling service, may be with the help from other service providers, the service provided by them would fall within the ambit of cargo handling service . It is submitted that shipping lines raise bill in the name of respondents and if any service tax is charged, the respondents are well within their rights to take cenvat credit of the same in accordance with the rules. However, that would not change the nature of service rendered by the respondents from cargo handling service to goods transport agency . It is contended that circulars which are reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der to provide service to the customers, respondent-companies take services of various intermediaries like lorry owners, shipping agencies etc. However, all the intermediaries raise the invoices in the name of aforesaid respondent companies only. It is submitted that the shipping agencies provide service to the respondent companies by raising invoice in their name and they issue a debit note of the same amount in the name of the customers. The respondent companies undertake the composite responsibility. It is submitted that the main activity of the respondents falls in the category of goods transport agency as defined under Section 65(50b) of the Act. It is further submitted that the respondents do not carry out any activity of packing or unpacking and if at all any activity of loading or unloading is undertaken, same is merely incidental to the main activity of goods transport agency . It is submitted that circulars dated 06.08.2008 and 05.10.2015 also support the case of the respondents. Further, it is submitted by learned senior counsel that the issue of classifiability is also squarely covered by the judgment of this Court in the case of Deputy Commissioner, Central Excise ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in agreement with the view taken by the High Court, in entertaining the writ petition against show cause notices, we refrain from recording any finding on contentious issues which arise for consideration. If any finding is recorded by this Court at this stage, same will prejudice either of the parties. Having regard to the contentions raised, it cannot be said that there are no factual disputes. Applicability of the circulars dated 06.08.2008 and 05.10.2015 is also in serious dispute. Further the classifiability of service rendered by a particular assessee is to be considered with reference to facts of each case depending upon nature of service rendered and the contract entered into. There cannot be any general declaration, as prayed for. The judgment of this Court in the case of Deputy Commissioner, Central Excise Anr. v. Sushil and Company (supra) also cannot be applied to the facts of the case on hand to come to the conclusion that the services rendered by the respondents will fall in the category of goods transport agency but not cargo handling service . In the aforesaid judgment, the contract was only for supply of labour and it was the specific case of the assessee that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . (supra) relied on by the learned senior counsel for the appellants also supports their case. In the aforesaid judgment, arising out of Central Excise Act, 1944, this Court has held that excise law is a complete code in order to seek redress in excise matters and held that entertaining writ petition is not proper where alternative remedy under statute is available. When there is a serious dispute with regard to classification of service, the respondents ought to have responded to the show cause notices by placing material in support of their stand but at the same time, there is no reason to approach the High Court questioning the very show cause notices. Further, as held by the High Court, it cannot be said that even from the contents of show cause notices there are no factual disputes. Further, the judgment of this Court in the case of Malladi Drugs Pharma Ltd. v. Union of India 2004 (166) ELT 153 (S.C.), relied on by the learned senior counsel for the appellants also supports their case where this Court has upheld the judgment of the High Court which refused to interfere at show cause notice stage. 20. For the aforesaid reasons, we allow this appeal and set aside the judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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