2019 (6) TMI 1205 - HC - Service Tax

Alternative remedy of appeal - Jurisdiction - principles of natural justice - Refund of service tax paid - 39/2012-S.T. dated 20.12.2018 being a notification issued by the Central Government in exercise of powers under Rule 6A of Service Tax Rules 1994 - denial of refund on the ground that the writ petitioner has not complied with the conditions mentioned in the notification - penalty - HELD THAT - In the instant case it is nobody s case that impugned orders have been passed without jurisdiction. It is also not anybody s case that impugned orders have been passed in violation of NJP - It is certainly nobody s case that the aforesaid alternate remedy by way of an appeal to the Commissioner (Appeals-II) available to the writ petitioner is either ineffectual or not efficacious. This Court is of the considered view that writ petitioner has not made out a case for interfering with the impugned orders in writ jurisdiction on the teeth of an available alternate remedy more so when alternate remedy is in the form of an appeal - the grounds that are being canvassed turn on facts i.e. factual disputes and therefore this Court is of the considered view that it would be appropriate to relegate the writ petitioner to the aforementioned alternate remedy. This being a case of fiscal law and the question turning on factual disputes this Court considers it appropriate to dispose of the writ petition holding that it is open to the writ petitioner to file an appeal before the aforesaid appellate authority assailing the impugned orders - Petition disposed off.

Summary

Issues:
1. Refund claims under Service Tax Notification No.39/2012-S.T.
2. Rejection of refund claims and imposition of penalty.
3. Compliance with conditions of the notification.
4. Availability of alternate remedy through appeal.
5. Application of Satyawati Tandon and K.C. Mathew cases.

Analysis:
1. The writ petitions involved seeking refunds under Service Tax for specific periods based on Notification No.39/2012-S.T. issued by the Central Government.

2. The respondent rejected the refund claims and imposed penalties for filing ineligible claims under Section 77(2) of the Finance Act, 1994.

3. The rejection was primarily due to non-compliance with the conditions of the notification, especially regarding the requirement to file a declaration prior to the date of export service.

4. The Court considered the availability of an alternate remedy through an appeal to the Commissioner (Appeals-II) and emphasized that the writ jurisdiction under Article 226 is not a rule of compulsion but discretion.

5. Referring to the Satyawati Tandon and K.C. Mathew cases, the Court highlighted the importance of exhausting statutory remedies before seeking relief under Article 226, especially in matters involving recovery of public dues or fiscal laws.

6. Given the factual disputes and the availability of an effective alternate remedy through an appeal, the Court decided to dispose of the writ petitions, allowing the petitioner to challenge the impugned orders before the appellate authority.

7. The Court clarified that all grounds raised in the writ petitions can be addressed in the appeal, including seeking condonation of delay under Section 14 of the Limitation Act.

8. Ultimately, both writ petitions were disposed of with directions for the petitioner to pursue the available appellate remedy, leaving all questions open for consideration by the appellate authority.