M/S S.S. Construction vs. Union Of INDIA And Another

Facts

The petitioner, M/s S.S. Construction, challenged an order of assessment dated 23.09.2022, passed by respondent no.2, before the Allahabad High Court. The respondent raised an objection regarding the maintainability of the writ petition, citing the availability of a statutory alternative remedy of appeal. The petitioner sought an adjournment to address this objection. Subsequently, the petitioner argued that the assessment order was invalid because service tax had already been paid by U.P. Power Corporation on the disputed items, and that proceedings for levying service tax were without jurisdiction due to the omission of Chapter V of the Finance Act, 1994, by Section 173 of the Central Goods and Service Tax, 2017. The petitioner relied on a previous Division Bench judgment to support entertaining the writ petition directly.

Held

The Court held that the issue regarding service tax having already been paid by U.P. Power Corporation is a factual matter that can be determined in the appropriate appellate proceedings. Routine issues concerning the legality of an assessment order are not typically entertained under the extraordinary writ jurisdiction when a statutory alternative remedy exists. Regarding the omission of Chapter V of the Finance Act, 1994, the Court found that obligations created thereunder continue to be saved by Section 174(2)(c) of the GST Act, 2017. Therefore, the petitioner cannot challenge the imposition of service tax on this ground. Consequently, the Court was not inclined to entertain the writ petition directly, bypassing the statutory remedy of appeal. However, in the facts of the case, the petitioner was permitted to prefer the statutory appeal within four weeks, with the condition that it would be entertained without any objection regarding limitation.

Key Issues

1. Whether the writ petition is maintainable directly before the High Court, bypassing the statutory alternative remedy of appeal, in light of the objection raised by the respondent? (Question of law) 2. Whether the assessment order is bad on the ground that service tax had already been paid by U.P. Power Corporation on the items in question? (Question of mixed law and fact) 3. Whether proceedings for levying service tax are without jurisdiction due to the omission of Chapter V of the Finance Act, 1994, by Section 173 of the Central Goods and Service Tax, 2017? (Question of law) Petitioner's contentions: The writ petition should be entertained directly as per the precedent in Bharat Mint and Allied Chemicals Vs. Commissioner Commercial Tax 2022 NTN 78 493. The assessment order is invalid because service tax was already paid by U.P. Power Corporation, and the levy of service tax is without jurisdiction due to the omission of Chapter V of the Finance Act, 1994, by Section 173 of the CGST Act, 2017. Respondent's contentions: Section 173 of the CGST Act, 2017, must be read with Section 174, which saves existing proceedings and obligations under the Finance Act, 1994, specifically by virtue of Section 174(2)(c). Therefore, the omission of Chapter V does not invalidate the levy of service tax.