2025 (3) TMI 56 - HC - GST

Maintainability of petiiton - availability of alternative remedy - Validity of ex parte order passed by the Principal Commissioner declaring the petitioner liable for Service Tax - violation of principles of natural justice - HELD THAT - In the facts of the present case what is evident to this Court is that learned counsel for the petitioner had withdrawn CWJC No. 9292 of 2010 with liberty to take recourse to such alternative remedies as are otherwise available in accordance with law. No doubt this Court granted liberty to the petitioner to file a fresh writ petition on the same and subsequent cause of action if the need so arise that would not have any bearing on the present case where admittedly the petitioner has got an alternative remedy of appeal and in fact in order to avail that remedy the petitioner had already deposited 7 percent of the pre-deposit requisite amount. In the case of Godrej Sara Lee Ltd. vs. Excise and Taxation Officer-cum-Assessing Authority and Others 2023 (2) TMI 64 - SUPREME COURT the Hon ble Supreme Court has taken a view as to the circumstances under which the petitioner may be relegated to the alternative remedy of appeal. In the totality of the facts and circumstances it is refrained from entertaining the writ application at this stage and relegate the petitioner to statutory remedy of appeal if so advised - If a duly constituted appeal is preferred by the petitioner within a period of eight weeks from today the same shall be considered by the Appellate Authority and in case a question of limitation arises for consideration the Appellate Authority shall consider the same keeping in view the fact that the petitioner was pursuing this writ application since the date of its presentation in the Registry on 19.08.2024. The period spent before this Court would be liable to be excluded. Conclusion - The High Courts have discretion to entertain writ petitions based on policy convenience and discretion. The Court may relegate parties to statutory remedies if an effective alternative remedy exists. Application disposed off.

Summary

ISSUES PRESENTED and CONSIDERED:1. Whether the ex parte order passed by the Principal Commissioner declaring the petitioner liable for Service Tax is valid?2. Whether the proceeding initiated against the petitioner was without jurisdiction?3. Whether the works contract for the construction/repair of a bridge is excluded from the purview of Service Tax?4. Whether the Management Maintenance for repair of roads was exempted from Service Tax provisions?5. Whether the proceeding under Section 73 of the Finance Act, 1994 is time-barred?6. Whether the petitioner had an alternative equally efficacious remedy of appeal before the Tribunal?ISSUE-WISE DETAILED ANALYSIS:1. The Court considered the petitioner's challenge to the ex parte order declaring them liable for Service Tax. The petitioner argued that the order was unauthorized and arbitrary. The Court noted the petitioner's contention that the works contract for the construction/repair of a bridge falls outside the purview of Service Tax. The Court also considered the petitioner's reliance on a clarificatory notification exempting Management Maintenance for road repair from Service Tax. The Court examined the limitation period under Section 73 of the Finance Act, 1994.2. The Court analyzed the respondent's submission that the petitioner failed to avail the alternative remedy of appeal before the Tribunal within the prescribed period. The respondent argued that the adjudicating authority served notices to the petitioner, who did not respond, leading to the final order being passed. The Court noted the respondent's contention that the petitioner had already deposited a pre-requisite amount for filing a statutory appeal.3. The Court deliberated on the principles regarding the availability of alternative remedies and the discretion of the High Courts to entertain writ petitions. The Court referred to the Supreme Court's decision in Godrej Sara Lee Ltd. vs. Excise and Taxation Officer-cum-Assessing Authority, emphasizing the importance of an effective and efficacious alternative remedy.SIGNIFICANT HOLDINGS:The Court refrained from entertaining the writ application and relegate the petitioner to the statutory remedy of appeal. The Court highlighted that the availability of an alternative remedy does not bar the maintainability of a writ petition but is a matter of policy, convenience, and discretion. The Court directed the petitioner to file an appeal within eight weeks, considering the time spent pursuing the writ application.Core principles established:- Availability of alternative remedies does not render a writ petition automatically not maintainable.- The High Courts have discretion to entertain writ petitions based on policy, convenience, and discretion.- The Court may relegate parties to statutory remedies if an effective alternative remedy exists.Final determinations on each issue:- The writ application was disposed of, and the petitioner was directed to pursue the statutory remedy of appeal within eight weeks.- No coercive action was to be taken against the petitioner for the specified period.Overall, the Court emphasized the importance of exhausting statutory remedies before seeking relief through writ petitions, in line with established legal principles and precedents.