TMI Blog2021 (3) TMI 601X X X X Extracts X X X X X X X X Extracts X X X X ..... ST Act was introduced from 01.07.2017. Both are separate enactments with detailed provisions relating to charging section and the measure of tax and machinery. It appears that in similar challenges made to the levy of service tax on royalty paid on minerals, the matter went up to the Apex Court in the case of Udaipur Chambers of Commerce and Industry and Others [ 2018 (8) TMI 287 - SC ORDER ], arising out of a judgment of the High Court of Judicature for Rajasthan at Jodhpur [ 2017 (10) TMI 975 - RAJASTHAN HIGH COURT ]- It was held by Apex Court that Until further orders payment of service tax for grant of mining lease/royalty by the petitioners shall remain stayed. Other High Courts have passed more or less similar interim orders relating to payment of service tax on royalty as noticed hereinabove. The High Court of Bombay at Goa in GOA MINING ASSOCIATION ANR VERSUS UNION OF INDIA ORS. [ 2017 (8) TMI 1632 - BOMBAY HIGH COURT ] has stayed the imposition of service tax on royalty, but at the same time clarified that it would not come in the way of the revenue for conducting and completing its assessment and enquiry. While the revenue is not restrained from conducting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hese petitioners have sought quashing of the notices issued by the Superintendent, CGST CX, directing them to furnish data relating to payment of royalty against licensing services for right to use minerals including exploration and evaluation for the period April, 2016 to June, 2017. In W.P.(T) No. 3736 of 2020, petitioner has also sought quashing of the demand-cum-show cause notice issued by respondent no. 3 for payment of service tax for the same period on such royalty under reverse charge mechanism. Relying upon the interim order passed by the Hon'ble Supreme Court dated 11.01.2018 in Special Leave to Appeal (Civil) No. 37326 of 2017, petitioners have prayed restraint upon the respondents from payment of service tax for grant of mining lease/royalty by the petitioners. 4. In W.P.(T) No. 290 of 2021, W.P.(T) No.307 of 2021 and W.P.(T) No.453 of 2021, the levy of JGST is under challenge by the petitioners on similar ground. In the remaining batch of writ petitions, the levy of service tax and CGST are under challenge. According to these petitioners, no service tax and/or GST is leviable on the amount of Royalty and District Mineral Fund contribution paid by the petitione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. Learned counsel for the petitioners in the batch of cases leaving the first three writ petitions i.e. W.P.(T) Nos. 3878 of 2020, 3736 of 2020 and 4163 of 2020, has made additional submissions to question the leviability of CGST and/or JGST in the case of respective individual petitioners, as the case may be, on the same lines. Learned counsel for the petitioners has referred to the various provisions of the CGST Act, 2017 and/or JGST Act, 2017 read with the entry in Schedule -II to submit that even under the GST regime royalty cannot be treated as a consideration for the purposes of levy of GST. Provisions under Section 2(31)- 'consideration', Section 7 regarding 'Scope of supply' and Section 9 - 'Levy and collection' as also Section 15 i.e. 'Value of taxable supply' of GST Act, 2017 have been placed upon to buttress the submission. Learned counsel for the petitioners has also relied upon the case of Govind Saran Ganga Saran Vs. Commissioner of Sales Tax and others reported in 1985 (Supp) SCC 205 (para 6) delineating the four essential components of valid levy of tax. 8. Mr. Gadodia, learned counsel has also relied on the decision in the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... GST regime have significant difference in the provisions relating to levy of tax on goods and services compared to the Finance Act, 1994. In none of these interim orders relied upon by the petitioners, the levy of GST has been restrained. It is submitted that the meaning of 'consideration' as defined under Section 2(31) of the GST Act covers the licensing services for the right to use minerals including its exploration and evaluation. Learned Advocate General has further submitted that the interim order passed by the Apex Court in the case of Udaipur Chambers of Commerce and Industry and Others Vs. Union of India and Others arose from a challenge relating to the leviability of service tax on royalty in connection with licensing services of minor minerals. In the present writ petitions at this stage, the department has only called for data and information relating to royalty for the purposes of determining the tax liability of the petitioners under JGST. The writ petitions are premature as there is no imminent recovery of GST from the petitioners. The State would however file a comprehensive counter-affidavit on the legal issues raised by the petitioners concerning the lev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enactments with detailed provisions relating to charging section and the measure of tax and machinery. It appears that in similar challenges made to the levy of service tax on royalty paid on minerals, the matter went up to the Apex Court in the case of Udaipur Chambers of Commerce and Industry and Others (Supra), arising out of a judgment of the High Court of Judicature for Rajasthan at Jodhpur. The Apex Court has been pleased to pass the following interim order: Heard the learned counsel for the petitioners and perused the relevant material. Application for exemption from filing certified copy of the impugned order is allowed. Issue notice. Until further orders payment of service tax for grant of mining lease/royalty by the petitioners shall remain stayed. 14. Other High Courts have passed more or less similar interim orders relating to payment of service tax on royalty as noticed hereinabove. The High Court of Bombay at Goa vide interim order dated 22.08.2017, has stayed the imposition of service tax on royalty, but at the same time clarified that it would not come in the way of the revenue for conducting and completing its assessment and enquiry. 15. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
