2017 (10) TMI 563 - HC - Service Tax

Jurisdiction - case of petitioner is that as for a composite contract involving material supply and provision of service, service tax can be demanded only on the service portion and the respondent does not have a jurisdiction to levy service tax on the value of the materials - maintainability of petition - Held that - The High Court only in exceptional cases can invoke its extraordinary jurisdiction under Article 226 of the Constitution, when there is an adequate effective and efficacious alternate remedy available to the litigant - The points canvassed here, are not pure questions of law, but intricate factual issues, which cannot be adjudicated in a Writ Petition - Writ Petition dismissed as not maintainable.

Summary

Issues: Jurisdiction of levying service tax on composite contract involving material supply and service; Maintainability of Writ Petition without exhausting alternate remedy of appeal.

Jurisdiction Issue:
The judgment pertains to a Writ Petition challenging an order confirming service tax demand, interest, and penalty. The petitioner argued that service tax can only be levied on the service portion of a composite contract, not on materials, citing a Supreme Court decision. The petitioner sought relief under Article 226 of the Constitution. However, the Court noted that extraordinary jurisdiction can be invoked only when no effective alternate remedy exists. The Court found the case involved intricate factual issues, not pure questions of law, and dismissed the Writ Petition, emphasizing the need to exhaust the appeal remedy.

Maintainability of Writ Petition:
The petitioner bypassed the alternate remedy of filing an appeal before the Commissioner (Appeals-I) and directly approached the High Court through the Writ Petition. The Court highlighted that exceptional cases warranting Article 226 intervention are rare and subject to the availability of an adequate alternate remedy. The Court emphasized that the present case did not meet the criteria for invoking extraordinary jurisdiction under Article 226. Consequently, the Writ Petition was dismissed as not maintainable, with no costs imposed, and the connected Miscellaneous Petition was closed.