M/S. Kalinga Mining Corporation PVT.LTD. vs. Union Of INDIA

Facts

The petitioner, M/s Kalinga Mining Corporation Pvt. Ltd., filed a writ petition challenging a show cause notice dated 01.02.2019, issued by the Director General of Goods and Services Tax Intelligence, Bhubaneswar. The notice was based on notification No.22/2016-ST dated 13.04.2016, which purportedly allowed the levy of service tax on royalty, District Mineral Fund, and National Mineral Exploration Trust charges paid by the petitioner. The petitioner relied on stay orders from the Supreme Court in similar matters and a judgment from the Gujarat High Court in support of their contention. The Court noted that an alternate remedy was available to the petitioner.

Held

The Court observed that an alternate remedy was available to the petitioner to approach the appellate authority, who is competent to consider the matter. The appellate authority was directed to take into account the stay orders granted by the Hon'ble Supreme Court in similar matters. The Court granted liberty to the petitioner to approach the appellate authority within four weeks. Pending the appellate authority's decision, no coercive action would be taken against the petitioner pursuant to the impugned show cause notice. The Court also directed that the period of pendency of the writ petition (11.04.2019 till the date of the order) should be considered for condonation of delay, if any, in approaching the appellate authority, acknowledging the petitioner's bona fide mistake in approaching a wrong forum. The petitioner was permitted to take back original documents by substituting attested photocopies.

Key Issues

1. Whether the show cause notice dated 01.02.2019, issued by the Director General of Goods and Services Tax Intelligence, Bhubaneswar, is valid, particularly concerning the levy of service tax on royalty, District Mineral Fund, and National Mineral Exploration Trust charges paid by the petitioner, in light of notification No.22/2016-ST dated 13.04.2016. Petitioner's contentions: The petitioner argued that the levy of service tax on the aforementioned charges was not permissible. They relied on stay orders granted by the Hon'ble Supreme Court in SLP(C) Nos.3150-3155/2018 (05.02.2018) and SLP(C) No.37326/2017 (11.01.2018), and a judgment of the Gujarat High Court in Gujmin Industry Association Vs. Union of India (2018 SCC On Line Guj 1417). Revenue's contentions: The judgment does not record any specific contentions made by the revenue or opposite parties.