TMI Blog2023 (11) TMI 901X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of sale of the materials used for pest control was considered by the various High Courts as well as the Apex Court. It is an admitted fact that the said question has found a quietus in as much as the Apex Court has held that the contract of pest control has an element of sale of chemicals involved and is, therefore, a works contract and is amenable to tax as such. The Appellate Tribunal has directed the reworking of the assessments on the basis of the findings of the Apex Court. Even going by the decision of the Appellate Tribunal, the petitioner had been relegated to the Assessing Authority for passing an order of assessment in the light of the decision of the Apex Court. Nothing precludes the consideration of the contentions of the assessee at the hands of the Assessing Authority. I, therefore, find that the Assessing Authority is duty bound to consider the contentions of the assessee on facts before proceeding with the modification of the assessment as directed in Ext. P5. A person whether a manufacturer or importer must fight his own battle and must succeed or fail in such proceedings. Once the assessment of levy has become final in his case, he cannot seek to reopen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in paragraphs 9 and 10, taking note of the decision of the Apex Court in State of Gujarat v. Bharat Pest Control [2018-TIOL-310-SC]. There is a further prayer for a direction to respondents 4 and 5 to deposit the amount of service tax erroneously collected from the petitioner to the 1st respondent to discharge the VAT liability confirmed by Ext. P5 order. Challenge is also raised to Ext. P11 order of the 6th respondent rejecting the request for refund of the service tax paid and Ext. P14 notice issued by the 7th respondent under Section 25(1) of the Kerala Value Added Tax Act (for short, 'the KVAT Act'). The assessment years in question in the said writ petition are from 2008-'09 to 2012-13. 2. The prayer in W.P.(C) No. 19432/2021 is to quash Ext. P13 order of the 6th respondent dated 5.7.2021, by which, the annual returns filed by the petitioner for the financial year 2015-'16 claiming exemption on receipts of service contracts have been rejected and resorted to assessment under Section 25(1) of the KVAT Act. 3. Heard Sri. Bharat Raichandani, the learned counsel appearing for the petitioner, Sri. Sreelal N. Warrier, the learned Standing Counsel appearing fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authorised collections without authority of law. The decisions in U.P. Pollution Control Board and Ors. v. Kanoria Industrial Ltd. and Ors. [MANU/SC/ 1449/2001], Malabar Gold Pvt. Ltd. v. Commercial Tax Officer, Kozhikode [2013 (32) S.T.R. 3 (Ker.)], Kerala Classified Hotels and Resorts Association and ors. v. Union of India and ors. [2013-TIOL-533-HC-Kerala-ST] and M/s.Murugan Agencies v. State of Kerala and Ors. [2016- TIOL-611-HC-Kerala-VAT] are relied on in support of the said contention. It is contended that the decisions in Union of India (UOI) and ors. v. K.G. Khosla Co. Ltd. and ors. [MANU/SC/0434/1979] and Bharat Heavy Electrical Limited and ors. v. Union of India (UOI) and ors. [MANU/SC/ 0467/1996] are authority on the point that amounts wrongly paid as tax can be directed to be paid to the authorities who are legally entitled to tax. 5. It is contended that the petitioner is admittedly providing services of pest control. Ext. P1 is a model contract entered into by the petitioner with its customers. It is submitted that the very specific clauses of the contract will show that the contract is a service contract simplicitor and that there is no transfer of prop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. v. State of Maharashtra [2018 (13) G.S.T.L. 292 (Bom.)], Parijat Construction v. CCE [2018 (359) ELT 113 (Bom)] , the decision of the Gujarat High Court in Union of India v. Alstom India Limited [2014 (301) ELT 446 (Guj.)] as also the decision of the Karnataka High Court in Commissioner v. KVR Construction [2012 (26) STR 195 (Kar.)]. 8. The learned counsel appearing for the Revenue, on the other hand, submits that the contention of the petitioner that the transaction is a service contract cannot be accepted in the light of the concluded judgments of the Apex Court in identical situations. It is contended that a pest control contract cannot be carried out without the consumption of pesticides and chemicals and that it has been clearly held that where such pesticides or chemicals are used for the purpose of pest control in a contract, there is an element of sale involved and that the contract would, therefore, fall specifically within the four corners of a works contract. It is contended that in such circumstances, the petitioner was duty bound to meet the demand for VAT which has been raised on the basis of the directions issued by the Appellate Tribunal. It is conten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orth in the order rejecting the claim for refund. It is submitted that the petitioner having paid the service tax voluntarily and not having challenged the levy of service tax in any proceedings till this day cannot be heard to contend that the entire service tax paid by it or even the proportionate amount as has been demanded by the VAT authorities are to be paid by the Service Tax Authority to the VAT authorities. It is submitted that there is absolutely no provision of law enabling such an exercise. 11. Having considered the contentions on all sides and having gone through the decisions referred to in detail, I find that the imposition of any tax has to be with the authority of law. In the instant case, the petitioner apparently proceeded on the assumption that the activity carried out by it was a service contract and proceeded to remit service tax in respect of its entire turn over. However, the question whether a pest control contract is a works contract by reason of there being an element of sale of the materials used for pest control was considered by the various High Courts as well as the Apex Court. It is an admitted fact that the said question has found a quietus in as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthority of law. The Supreme Court having held that where levy and collection of tax/cess is unconstitutional or without authority of law, a writ seeking refund of tax/cess collected without authority of law was held to be maintainable. After noticing that the Apex Court had also held that a Civil Writ Petition solely praying for refund of money against the State by a writ of mandamus is not to be entertained, the Bench went on to hold that since the collection of money was itself without authority of law, there is no good reason to deny relief of refund to citizens in such cases. In the said judgment, the Punjab and Haryana High Court had finally decided as follows :- 25. The argument that refund of this amount would amount to unjust enrichment of the petitioner is without foundation in fact or in law. The Union of India has raised a demand for service tax for the period for which the State of Haryana has levied and collected VAT. If the petitioner is called upon to pay VAT and service tax, it would be the case of double taxation. Even otherwise all that we propose to do is to direct the State of Haryana to forward this amount to the Union of India. 26. Having held as a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctments, they will certainly have due regard to the legislative intent evidenced by the provisions of the said Acts and would exercise their jurisdiction consistent with the provisions of the Act. The writ petition will be considered and disposed of in the light of and in accordance with the provisions of Section 11B. This is for the reason that the power under Article 226 has to be exercised to effectuate the rule of law and not for abrogating it. The said enactments including Section 11B of the Central Excise and Salt Act and Section 27 of the Customs Act do constitute law within the meaning of Article 265 of the Constitution of India and hence, any tax collected, retained or not refunded in accordance with the said provisions must be held to be collected, retained or not refunded, as the case may be, under the authority of law. Both the enactments are self-contained enactments providing for levy, assessment, recovery and refund of duties imposed thereunder. Section 11B of the Central Excise and Salt Act and Section 27 of the Customs Act, both before and after the 1991 (Amendment) Act are constitutionally valid and have to be followed and given effect to. Section 72 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ving been filed, no refund claim could be made. 18. In the instant case, the petitioner had made the payment of the service tax for the periods in question voluntarily and had never challenged the authority of the Service Tax Authorities. It is also not in dispute before me that the levy was under the provisions of an enactment which the petitioner still maintains is applicable to the transaction in question. It is only at a belated stage when the VAT authorities raised a demand on the basis of the law as decided by the Apex Court that the petitioner, for the first time, raises a claim for refund of the service tax paid or seeks payment of the VAT demanded by the Service Tax Authorities. The petitioner who had volunteered to pay the service tax and never challenged the said levy cannot attempt to get over the provisions of the statute providing for the conditions which have to be satisfied for raising such a demand. The instant case is not one where the levy of service tax was under any provision found to be constitutionally invalid. The levy was under the provisions of a valid statute and the petitioner had raised no objection or appeal as against the assessment. 19. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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