2014 (10) TMI 163 - HC - Service Tax

Renting of immovable property - Constitutional validity of section 75(5)(h) and section 76 of the Finance Act, 2010 - Held that - Similar issue has been dealt with in Vir Retail Private Limited v. Union of India 2013 (9) TMI 789 - KARNATAKA HIGH COURT - The learned counsel appearing for the respondent/Revenue does not dispute this fact. Said directions issued would equally apply to the petitioner herein and accordingly this writ petition is also disposed of by hold ing that subject to decision of the apex court and reserving liberty to petitioner to make necessary application to recall the order if any pursuant to decision of the apex court. Demand relating to cenvat credit - Held that - Parties have produced voluminous documents. The petitioner has claimed Cenvat credit in respect of certain amounts. Learned counsel contends that authorities were required to consider the same which is seriously disputed by learned counsel appearing for Revenue. In that view of the matter it would be appropriate to direct the petitioner to appear before the Commissioner of Service tax (second respondent) herein and put forth its claim if any seeking for entitlement of Cenvat credit and in turn second respondent shall examine the claim of the petitioner under all heads and pass orders on merits and in accordance with law. It is made clear that no view is expressed with regard to merits of the claim made by the petitioner in so far as the entitlement of Cenvat credit by it. Same is kept open. The petitioner shall appear before the second respondent on June 24, 2013 without waiting for any further notice. Second respondent shall consider the claim on the merits and second respondent is at liberty to examine all the issues and pass orders thereon - Matter remanded back.

Summary

Issues:
1. Challenge to the provisions of the Finance Act, 1994 as amended by the Finance Act, 2008 and the Finance Act, 2010.
2. Challenge to the provisions of section 75(5)(h) and section 76 of the Finance Act, 2010.
3. Extending Cenvat credit to the petitioner.

Analysis:
1. The petitioner sought a writ of certiorari to declare certain provisions of the Finance Act, 1994 as amended by the Finance Acts of 2008 and 2010 as null and void, ultra vires of the Constitution of India. The petitioner also aimed to declare all notifications and circulars issued under these Acts as null and void. The respondent filed objections denying the petition's claims. The court considered similar contentions in a previous case and directed petitioners to furnish security for arrears of tax pending a decision by the apex court. The court held that the same directions applied to the present petitioner, disposing of the case subject to the apex court's decision.

2. Another issue raised in the petition was the challenge to the provisions of section 75(5)(h) and section 76 of the Finance Act, 2010. The petitioner sought to declare these provisions as null and void, arbitrary, and ultra vires of the Constitution of India. The court noted that the directions issued in a previous case applied to the present petitioner as well, subject to the decision of the apex court. The court reserved the petitioner's right to seek necessary applications based on the apex court's decision.

3. The third issue involved the extension of Cenvat credit to the petitioner, which was claimed but not considered by the authorities. The petitioner contended that the amounts claimed had been remitted to the respondent and argued for entitlement to Cenvat credit. The respondent disputed this claim, stating that ineligible credits were included in the claim, and Cenvat credit on such ineligible credits should not be allowed. The court directed the petitioner to appear before the Commissioner of Service Tax to present its claim for Cenvat credit, allowing the second respondent to examine the claim on merits and in accordance with the law. The court kept all contentions open for adjudication before the second respondent, who was also directed to examine all other claims put forth by the petitioner.