2010 (11) TMI 237 - HC - Service Tax

Demand - whether such service tax could be levied in respect of service rendered outside the Territory of India - the petitioner has not chosen to give any reply to the said show cause notice, instead rushed to this Court with this writ petition - when the petitioner has got alternative remedy, which is efficacious, the writ petition cannot be entertained at all - The petitioner can very well submit his explanation and if any adverse order is passed, he can very well work out his remedy in the manner known to law - this writ petition is dismissed, however, with liberty to the petitioner to submit his explanation to the impugned show cause notice within a period of four weeks

Summary

Issues involved:
Challenge to show cause notice for service tax on educational cess outside India, maintainability of writ petition without exhausting alternative remedy.

Analysis:
The writ petition challenges a show cause notice by the Commissioner of Central Excise regarding service tax on educational cess for a specific period. The main issue is whether service tax can be imposed for services rendered outside India. Reference is made to a previous judgment where it was held that the liability of the petitioner should be calculated from a certain date. The petitioner argues that they should only be liable for service taxes from a later date in relation to services outside Indian territory. However, the respondent contends that the previous judgment does not apply to the current case as the services were rendered outside India but received within Indian territory. The respondent also raises a preliminary objection on the maintainability of the writ petition, stating that the petitioner should have responded to the show cause notice instead of approaching the court directly.

The court addresses the issue of maintainability first. It notes that the petitioner did not respond to the show cause notice but directly filed the writ petition. The court emphasizes that when an alternative and effective remedy is available, the writ petition cannot be entertained. The petitioner is advised to provide an explanation to the show cause notice within four weeks, and if submitted, the respondent must decide on the matter within eight weeks thereafter. The court dismisses the writ petition without expressing any opinion on its merits, granting the petitioner the opportunity to present their explanation to the notice.

In conclusion, the court rules that the writ petition challenging the show cause notice for service tax on educational cess outside India is not maintainable due to the availability of an alternative remedy. The petitioner is directed to submit their explanation to the notice within a specified period, after which the respondent will make a decision in accordance with the law.