2020 (7) TMI 531 - HC - Service Tax

Maintainability of application - appropriate forum - High Court or Supreme Court - Issue involving determination of rate of Service Tax - whether fabrication of structure which was not covered under the expression erection of plant, machinery, or equipment s ? - no civil work was undertaken - Erection Commissioning and Installation Service or not? Mr. Shah pointed out that the impugned orders in both the appeals passed by the Appellate Tribunal are one relating to the rate of duty of service tax. According to Mr. Shah, the appeal would lie before the Supreme Court. HELD THAT - Both the appeals are disposed of as not maintainable before this High Court with the liberty to take appropriate steps in accordance with law before the appropriate forum - appeals disposed off.

Summary

Issues involved:
Validity of the order passed by the Customs Excise and Service Tax Appellate Tribunal - Tax Appeal No.2332 of 2010. Jurisdiction of the High Court to hear the appeal based on Section 35L of the Central Excise Act, 1944.

Analysis:
1. The Tax Appeal No.2332 of 2010 raised substantial questions of law regarding the activity undertaken by the respondent, challenging the order of the Customs Excise and Service Tax Appellate Tribunal. The questions pertained to the classification of the activity as either fabrication of structure or manufacturing activity, impacting the liability to pay service tax under specific provisions of the Finance Act and Central Excise Act.

2. The High Court admitted the Tax Appeal for final hearing based on the substantial questions of law raised, which were identical to those in another connected appeal. The Court acknowledged the importance of resolving these questions and directed the matters to be listed for further proceedings.

3. During the final hearing, the Standing Counsel for the Excise Department contended that the appeals were not maintainable before the High Court as they related to the rate of duty of service tax, falling within the jurisdiction of the Supreme Court as per Section 35L of the Central Excise Act, 1944. The counsel highlighted the specific clause (b) of Section 35L, emphasizing the appeal route to the Supreme Court for such matters.

4. Considering the jurisdictional issue raised by the Standing Counsel, the High Court disposed of both appeals, declaring them not maintainable before the High Court. The Court granted liberty to the parties to pursue appropriate legal actions before the competent forum, in this case, the Supreme Court, as per the provisions of the Central Excise Act, 1944.

5. The High Court clarified that the disposal of the appeals on jurisdictional grounds did not imply any opinion on the merits of the substantial questions of law raised in the appeals. The Court maintained neutrality on the legal issues involved and focused solely on the question of jurisdiction as per the statutory provisions of the Central Excise Act, 1944.

6. Consequently, both Tax Appeal No.2332 of 2010 and the connected F/Tax Appeal No.2258 of 2020 were disposed of as not maintainable before the High Court, leading to the dismissal of the appeals without delving into the substantive legal arguments presented. The Court's decision aimed to uphold the statutory framework and direct the parties to pursue appropriate legal remedies in the Supreme Court for matters concerning the rate of duty of service tax.