The Superintendent Of Police vs. Union Of INDIA

Held

The Court did not decide the merits of the case regarding the taxability of the petitioner's services. Instead, it noted that a similar writ petition filed by the Superintendent of Police, Tirunelveli District, was disposed of by giving liberty to file a statutory appeal before the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai. Following this precedent, the Court disposed of the present writ petition by granting the petitioner liberty to file a statutory appeal before CESTAT, Chennai, within 60 days from the date of the order. The Court directed CESTAT to entertain the appeal and dispose of it on merits, considering the decisions cited by the petitioner, without insisting on a certified copy of the High Court's order. Recovery proceedings, if any, were directed to be lifted. If the appeal is not filed within the stipulated time, the respondents are at liberty to proceed as if no liberty was granted.

Facts

The petitioner, the Superintendent of Police, Dindigul District, filed a writ petition challenging an Order-in-Original dated 30.09.2013 passed by the Joint Commissioner of GST & Central Excise, Madurai, and a subsequent letter dated 29.08.2022 issued by the Superintendent of GST & Central Excise, Dindigul II Range, to Canara Bank. The impugned order demanded service tax, interest, and penalty for security services rendered by the Dindigul Police to banks and private institutions during the period 01.04.2011 to 31.12.2012. The total service tax liability was determined at Rs. 89,468/- on a taxable value of Rs. 7,30,060/-. The petitioner sought a declaration that their activities are outside the purview of Union levy of Service Tax as Security Agencies Services and requested instructions to subordinate officers not to levy service tax on statutory services rendered under police acts.

Key Issues

1. Whether the services rendered by the petitioner (Dindigul Police) to banks for cash transportation and other private institutions constitute 'Security Agency Services' taxable under the Finance Act, 1994, for the period 01.04.2011 to 31.12.2012? Petitioner's arguments: The petitioner contended that their activities are statutory functions related to law and order and escort duties, not commercial security services. They relied on a CESTAT decision in Superintendent of Police Vs. Commissioner of Central Goods and Service Tax, Excise and Customs (Service Tax Appeal No.50390 of 2017), CBEC Circular No. 89/07/2006-ST, and decisions from the Calcutta High Court and other CESTAT benches, arguing that charges recovered for statutory functions by public authorities are not liable to service tax if certain conditions are met. Revenue's arguments: The respondents argued that the writ petition should be dismissed due to the availability of an alternate statutory remedy.