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2024 (6) TMI 1333 - HC - Service TaxMaintainability of appeal against order in original - Jurisdiction to pass order in appeal - HELD THAT - The Order-in-Original was passed by the Adjudicating Authority in exercise of powers conferred under Section 73 2 of the Finance Act 1994 whereas the Order-in-Appeal has been passed by the Appellate Authority in exercise of powers conferred on it under Section 85 of the Finance Act 1994. The learned counsel for the parties are not in disagreement on the fact that against the Order-in-Appeal an appeal lies under Section 86 of the Finance Act 1994 - The Order-in-Appeal has also mentioned that an appeal against the Order-in-Appeal would lie under Section 86 of the Finance Act 1994 to the Customs Excise and Service Tax Appellate Tribunal CESTAT within three months from the date on which the Order sought to be appealed against is communicated. It is in such backdrop the rival contentions made by the parties are to be considered in the present writ petition. Availability of an alternative remedy does not operate as an absolute bar to the maintainability of a writ petition. It has thus been observed that entertainability and maintainability of a writ petition are distinct concepts. While an objection to the maintainability goes to the root of the matter the question of entertainability is entirely within the realm of discretion of the High Courts. The issue involved in MAHARASHTRA CHESS ASSOCIATION VERSUS UNION OF INDIA (UOI) AND ORS. 2019 (7) TMI 1755 - SUPREME COURT was whether a private agreement entered into between the appellant and the second respondent in the form of the constitution and bye-laws of the later could by conferring exclusive jurisdiction on the courts of a particular place oust the writ jurisdiction of a High Court which does not have territorial jurisdiction over the courts of that particular place under Article 226 of the Constitution of India. It has been observed that the existence of an alternative remedy whether adequate or not does not alter the fundamentally discretionary nature of the High Court s writ jurisdiction and therefore does not create an absolute legal bar on the exercise of the writ jurisdiction by a High Court. Whether in the fact situation obtaining in the present case and on the basis of the contentions advanced by the parties an exceptional case has been made out for entertaining the writ petition? - HELD THAT - The petitioner has in the present writ petition raised a ground that despite raising the issue of non-receipt of the Letter dated 04.09.2020 in the appeal the Appellate Authority in the Order-in-Appeal did not give any consideration on it. It is trite to observe that this Court in writ proceedings does not determine any question of fact. Whether the Letter dated 04.09.2020 was issued or not and if issued whether it was served upon or received by the petitioner or not; etc. are questions of fact and in the fact situation obtaining in this case due to claim and contrary claim these are disputed questions of facts. It is settled that all questions of facts are to be decided by the Adjudicating Authority or the appellate authorities in the hierarchy constituted by the statute as such authorities are competent to deal with and decide on disputed questions of facts. The determination of such disputed questions of facts and to correct errors of fact fall within the province of the appellate authorities. As the said aspect is a disputed question of fact this Court in writ jurisdiction is not required to embark on a fact-finding exercise on the said aspect. In the case in hand the concerned Financial Year was 2015-2016 in respect of which the allegations regarding suppression of actual value of services provided and short-payment of Service Tax dues are made. The Demand-cum-Show Cause Notice dated 26.04.2021 was issued invoking the power under the proviso to sub-section 1 of Section 73 of the Finance Act 1994. According to the petitioner it had duly filed its returns in Form ST-3 for the Financial Year 2015-2016. It is a settled proposition that the extra-ordinary and discretionary jurisdiction to issue a writ in the nature of certiorari under Article 226 of the Constitution of India is different from appellate jurisdiction. The writ jurisdiction extends only to cases where the orders are passed by tribunals or authorities without jurisdiction or by assuming jurisdiction where their exists none or in excess of their jurisdiction by crossing the limits of jurisdiction or by refusing to exercise jurisdiction vested in them or acting illegally or improperly in exercise of their jurisdiction causing grave miscarriage - It is not the case of the petitioner that the Demand-cum- Show Cause Notice was issued beyond the period of five years from the relevant date thereby making it a case as one without jurisdiction. Rather it is the case of the petitioner that the Adjudicating Authority had issued the Demand-cum-Show Cause Notice by illegally extending the period of thirty months to five years. Having regard to the fact situation obtaining in the case in hand the Appellate Tribunal can very well examine whether the petitioner was given adequate notice or was afforded adequate opportunity or a fair hearing in the proceedings before the Adjudicating Authority and/or before the first Appellate Authority. The contention of the petitioner as regards non-consideration of its Letter dated 15.09.2023 is also to be considered from the above perspective. Since this Court is of the considered view that neither the Order-in-Original nor the Order-in-Appeal has been passed in total violation of the principles of natural justice the petitioner has not been able to make out an exceptional case on this point for entertaining the present writ petition. In view of the fact that a statutory adequate and efficacious remedy of appeal has already been provided for to assail an order like the Order-in-Appeal before the Appellate Tribunal having the power to condone any delay this Court is of the considered view that the writ petition preferred under Article 226 of the Constitution of India is not to be entertained at this stage reserving the liberty to the petitioner to avail the statutory remedy of appeal provided under Section 86 of the Finance Act 1994. It is accordingly observed. Consequently the interim order passed earlier stands recalled. Petition disposed off.
Issues Involved:
1. Violation of principles of natural justice. 2. Jurisdiction of the Adjudicating Authority. 3. Adequacy of the Demand-cum-Show Cause Notice. 4. Adequacy of the opportunity provided to the petitioner. 5. Maintainability of the writ petition despite the availability of statutory remedies. Detailed Analysis: 1. Violation of Principles of Natural Justice: The petitioner argued that the principles of natural justice were violated during the proceedings leading to the Order-in-Original and the Order-in-Appeal. The Adjudicating Authority mentioned a letter dated 04.09.2020, which the petitioner claimed was never received. The petitioner contended that had the letter been received, they could have responded appropriately, potentially avoiding the Demand-cum-Show Cause Notice. The court noted that the petitioner did not raise the issue of non-receipt of the letter in its initial reply but only during the appeal. The court emphasized that disputed questions of fact, such as the issuance and receipt of the letter, are to be determined by the adjudicating and appellate authorities, not in writ proceedings. 2. Jurisdiction of the Adjudicating Authority: The petitioner contended that the Adjudicating Authority illegally invoked the extended period under the proviso to Section 73(1) of the Finance Act, 1994, to issue the Demand-cum-Show Cause Notice. The court observed that the Adjudicating Authority has the jurisdiction to issue such a notice within five years if there are reasons to believe that any of the grounds mentioned in the proviso exist. The adequacy and sufficiency of the reasons for invoking the extended period can be challenged before the appellate tribunal, which is competent to decide on such issues. 3. Adequacy of the Demand-cum-Show Cause Notice: The petitioner argued that the Demand-cum-Show Cause Notice was issued without proper jurisdiction and was based on incorrect facts. The court noted that the Adjudicating Authority had recorded reasons in the notice, citing information from the Income Tax Department and alleging suppression of facts and short-payment of Service Tax. The court held that the appellate tribunal can examine whether the power to extend the period was properly exercised and whether the grounds for invoking the extended period were established. 4. Adequacy of the Opportunity Provided to the Petitioner: The petitioner claimed that they were not given adequate opportunity to present their case, including the opportunity to produce a vital document during the appellate proceedings. The court observed that the petitioner was given opportunities for personal hearings before both the Adjudicating Authority and the Appellate Authority. The court held that the issue of whether the petitioner was given adequate notice and opportunity can be examined by the appellate tribunal. 5. Maintainability of the Writ Petition Despite Availability of Statutory Remedies: The court discussed the principles laid down in various judgments regarding the maintainability and entertainability of writ petitions when an alternative statutory remedy is available. The court held that while the writ petition is maintainable, it should not be entertained in the present case as the petitioner has an adequate and efficacious statutory remedy of appeal under Section 86 of the Finance Act, 1994. The court emphasized that the appellate tribunal is competent to address the issues raised by the petitioner, including the adequacy of reasons for invoking the extended period and the alleged violation of principles of natural justice. Conclusion: The court concluded that the writ petition should not be entertained at this stage, reserving the liberty to the petitioner to avail the statutory remedy of appeal provided under Section 86 of the Finance Act, 1994. The court also observed that if an application for condoning the delay and an appeal are preferred by the petitioner, the appellate tribunal shall consider the same in accordance with law and on its own merits. Consequently, the interim order passed earlier was recalled.
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