THE GURUVAYUR DEVASWOM vs. CENTRAL BOARD OF EXCISE AND CUSTOMS

On 03.02.2016, when this writ petition came up for admission, this Court admitted the matter on file and passed the following order; “Learned Senior Standing Counsel for the Central Board of Excise and Customs takes notice. There will be an interim order that while the Central Board of Excise and Customs may decide on any matter pending at that end relating to the issues raised by the petitioner on the basis of the statutory provisions including the exemption orders, Exts.P3, P7 and P9 will stand stayed or a period of six months. The respondents, if so advised, will place their counter affidavits in the meanwhile.”

On 14.11.2016, along with I.A.No.18815 of 2016, the petitioner has placed on record Exts.P10 to P12 additional documents. Paragraphs 2 to 4 of the affidavit filed in support of that interlocutory application read thus; “2. The writ petition is filed by the petitioner praying for quashing Exts.P3, P7 and P9 notices issued by the 2nd respondent, to direct respondents 1 and 3 to pass orders on Exts.P5 and P6 representations submitted by the petitioner under Section 93 of the Finance Act claiming exemption from the purview of service tax under Finance Act, 1994, to declare that the petitioner-Guruvayur Devaswom Managing Committee is eligible for exemption under clauses 5(a), 5(b), 13(c), 24, 39, 39(q) and 29(zb) of Ext.P4 notification from the purview of payment of service tax and for other reliefs.

During the pendency of the writ petition, on the representation of the applicant-Devaswom dated 12.02.2016, the Department of Revenue, Ministry of Finance, Government of India has clarified clause 5(a) of Ext.P4 notification dated 20.06.2012 bringing a trust or institution registered under sub-section 23(c)(v) of Section 10 of the Income Tax Act or a body or authority covered under clause (23BBA) of Section 10 of the Income Tax Act. Aof the notification No.40/2016-service tax dated 06.09.2016 is produced herewith as Ext.P10. On the basis of Ext.P10 notification, circular No.200/10/2016-service tax dated 06.09.2016 has been issued by the Ministry of Finance for implementation of the same by giving wide publicity. Aof the circular dated 06.09.2016 is produced herewith as Ext.P11. Exts.P10 and P11 has been forwarded to the Devaswom by the Ministry of Finance, Department of Finance, Government of India along with their letter dated 12.09.2016. Aof the letter dated 12.09.2016 is produced herewith as Ext.P12. 4. It is respectfully submitted that Devaswom is exempted under Section 10(23BBA) of the Income tax Act and hence by virtue of Ext.P10 notification read with Ext.P11 circular the Devaswom is to be exempted from the purview of service tax.”

Heard the learned Standing Counsel for the petitioner and also the learned Senior Standing Counsel for Central Board of Excise and Customs, for the respondents.

The issue that arises for consideration in this writ petition is as to whether any interference is warranted, in exercise of the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India, on Exts.P3, P7 and P9 notices issued by the 2nd respondent Assistant Commissioner of Central Excise, whereby the petitioner is required to submit the documents called for in respect of alleged non-payment of service tax under the Finance Act, 1994. 6. In State of U.P v. Brahm Datt Sharma [(1987) 2 SCC 179] the Apex Court held that, when the show cause notice was issued under a statutory provision calling upon to show cause, the courts should be reluctant to interfere with the notice at that stage unless the notice is shown to have been issued palpably without any authority of law. The purpose of issuing show cause notice is to afford an opportunity of hearing and once cause is shown it is open to the authority to consider the matter in the light of the facts and submission placed before it and only thereafter a final decision in the matter could be taken. Therefore, interference by the Court before that would be premature.

In Seimens Ltd v. State of Maharashtra [(2006) 12 SCC 33] the Apex Court held that ordinarily, a writ court may not exercise its discretionary jurisdiction to entertain a writ petition questioning a notice to show cause unless the notice appears to have been without jurisdiction.

In Union of India v. Vicco Laboratories [(2007) 13 SCC 270] the Apex Court held that, normally, the writ court should not interfere at the stage of issuance of show cause notice by the authorities. In such a case, the parties get ample opportunity to put forth their contentions before the authorities concerned and satisfy the authorities concerned about the absence of case for proceeding against the person against whom the show cause notices have been issued. Abstinence from interference at the stage of issuance of show cause notice in order to relegate the parties to the proceedings before the authorities concerned is the normal rule. However, the said rule is not without exceptions. Where a show cause notice is issued either without jurisdiction or in an abuse of process of law, certainly, in that case, the writ court would not hesitate to interfere even at the stage of issuance of the show cause notice. The interference at the show cause notice stage should be rare and not in a routine manner. The mere assertion by the writ petitioner that notice was without jurisdiction and/or abuse of process of law would not suffice. It should be prima facie established to be so. Where factual adjudication would be necessary, interference is ruled out.

Viewed in the light of the law laid down in the decisions referred to supra, conclusion is irresistible that no interference is warranted on Exts.P3, P7 and P9 notices issued by the 2nd respondent, in exercise of the writ jurisdiction on this Court under Article 226 of the Constitution of India, on the grounds raised in this writ petition. It is for the petitioner to submit a proper reply to Exts.P3, P7 and P9 notices, within a period of four weeks from the date of receipt of a certified copy of this judgment, which shall be considered by the 2nd respondent Assistant Commissioner of Central Excise, after affording the petitioner an opportunity of being heard, before proceeding further. With the above direction, this writ petition is disposed of. The legal and factual contentions raised by the petitioner, relying on the additional documents produced as Exts.P10 to P12, along with I.A.No.18815 of 2016, are left open to be raised before the 2nd respondent at appropriate stage. ANIL K. NARENDRAN JUDGE