Delhi High CourtAirports Authority Of India vs Central Board Of Excise And Customs on 3 April, 2006Equivalent citations: (2007)207CTR(DEL)196Author:T.S. ThakurBench:T.S. Thakur,J.M. MalikJUDGMENT
 

T.S. Thakur, J.1. The only grievance which the petitioner has made in the present writ petition is that the respondents have under threats and coercion recovered a sum of Rs. 20 crores as service-tax on license fee/royalty/rent received by it towards non-cargo revenue without any order of assessment determining its liability or quantifying the amount recoverable from it. It is urged on behalf of the petitioner that although the record summoned by the respondents in connection with the proposed assessment proceedings has already been submitted yet the respondents have neither concluded the proceedings nor indicated the reasons for their failure. On the contrary, they have threatened the officials of the petitioner with arrest and detention and thereby coerced them to pay a huge amount of money towards tax which has not so far been held payable. The following relief has in the above backdrop been prayed for:(a) Issue a writ of certiorari calling for the service-tax assessment records pertaining to the petitioner for the period 10th Sept., 2004 to 31st March, 2005 and after going through the same quash the demand for service-tax so far as it relates to non-traffic revenue; and(b) Issue a writ of mandamus against the respondents prohibiting them from demanding service-tax from the petitioner on the income earned by the petitioner by way of non-traffic revenue;2. On behalf of the respondents, Mr. Malhotra, learned Solicitor General argued that the allegations regarding coercion and harassment levelled by the petitioner were without any basis whatsoever. He contended that it was the petitioner who was not co-operating with the ongoing assessment proceedings thereby delaying the quantification and the recovery of a huge amount of tax recoverable from it. He drew our attention to a letter dt. 28th March, 2005 addressed by the petitioner to the Asstt, Commr., Central Excise and Service-tax (Delhi Zone) inter alia praying for a provisional assessment pending clarification on certain issues by the Airports Authority of India. On receipt of the said letter, the Asstt. Commr., Service-tax, appears to have, by a communication dt. 29th March, 2005, permitted the petitioner to pay service-tax on a provisional basis under Rule 6(4) of the Service-tax Rules, 2002 r/w Rule 7 of the Central Excise Rules for the month of March, 2005 subject to the condition that the final return is filed by the petitioner by 30th June, 2005 so that the assessment could be completed within a period of six months. A final return has not, however, been filed by the petitioner within the time stipulated by the assessing authority, although according to learned Counsel for the petitioner, a regular return for the period 10th Sept., 2004 to 31st March, 2005 was eventually filed on 25th July, 2005 and a similar return for the period commencing 1st April, 2005 to 30th Sept., 2005 was filed in December, 2005. Mr. Malhotra, also drew our attention to a communication dt. 18th Oct., 2005, received by the Asstt. Commr., Service-tax from the petitioner-Airports Authority of India pointing out the difficulties in the submission of the complete data being demanded by the AO. The communication inter alia says:We are a large organisation having airports at 126 locations and the data flow procedures regarding service-tax are still in the process of being streamlined (since the category of airport services was made taxable only from 10th Sept., 2004). The data obtained from the various airports has to be first compiled region-wise and then finally checked and compiled at the headquarters, which is taking some time.3. It was on the above basis argued by Mr. Malhotra that the petitioner is on the one hand delaying the filing of the returns, seeking time for furnishing of the requisite data and thereby delaying the completion of the assessment proceedings, while on the other hand, it complains of harassment, threats and coercion for recovery of the amount of tax due from it. He submitted that a sum of Rs. 20 crores was paid by the petitioner towards the outstanding tax liability under protest in terms of a letter dt. 27th Feb., 2006, a copy whereof has been placed on record by the petitioner. He urged that the said payment was made voluntarily and without any coercion, threat or harassment whatsoever. He argued that the present writ petition was not maintainable in the light of the decision of the Supreme Court inOil & Natural Gas Commission v. CCE(1994) 116 CTR (SC) 643 : 1995 Supp (4) SCC 541, in terms whereof Airports Authority of India as a public sector undertaking was required to obtain the clearance of the Committee on Disputes before approaching this Court. No such permission has been, according to Mr. Malhotra, either applied for or produced by the petitioner.Relying upon the decision of the Bombay High Court in Life Insurance Corporation of India v. M. Ramarao and Ors. Writ Petn. No. 1881 of 2004 disposed of on 15th July, 2004, Mr. Malhotra prayed for the dismissal of this petition with costs.4. There are two distinct prayers which the petitioner has made in this petition, one relates to the demand made by the assessing authority for furnishing of records necessary for finalising the assessment proceedings, while the other relates to the alleged harassment of the petitioner at the hands of the respondents for recovery of the outstanding dues on non-traffic revenue which the petitioner considers to be rental income not exigible to tax. Insofar as the first part of the prayer is concerned, we see no reasons to interfere at this stage. The assessment proceedings as seen earlier are pending before the competent assessing authority. If certain information necessary for completing the said proceedings is demanded by the assessing authority, there is no reason why the petitioner should not co-operate and make available the said information. From the correspondence referred to earlier, it is evident that the petitioner has, at no stage, disputed the authority of the AO to look into the records or the information demanded by it. It has, on the contrary, explained its inability to immediately furnish the record on account of multiple locations from which the information has to come and the streamlining of data flow procedures regarding service-tax. The petitioner, it is evident, has been asking for time to produce the relevant information which it is otherwise obliged to produce.5. Learned Counsel for the petitioner, however, argued that the respondents are trying to bring to tax components which are not actually taxable under the provisions of law. We see no merit in that contention. Whether or not any particular component of the income which the petitioner is receiving is exigible to tax under the provisions of service-tax regulations under theFinance Actis a matter which is yet to be determined by the assessing authority. It is possible that a part of the amount which the petitioner is receiving may eventually be held to be not taxable but that does not necessarily affect the jurisdiction of the authority to make an assessment order. It is not a case of total lack of jurisdiction on the part of the authority to initiate the proceedings or to complete the same so as to call for any interference from a writ Court. The first prayer made in the writ petition is accordingly rejected.6. Even in regard to the second prayer, we see no reason to interfere. The writ jurisdiction of this writ petition is purely discretionary especially when petitioner is seeking a writ of mandamus. There is nothing before us to show that any of the respondents have threatened, coerced or harassed the petitioner for paying any amount. On the contrary, the letter which the petitioner himself has placed on record sufficiently shows that a sum of Rs. 20 crores has been voluntarily offered by the petitioner pending finalisation of the assessment proceedings. The fact that the payment is made under protest does not mean that the same is being made because of any harassment or coercion. Suffice it to say that the petitioner has prematurely rushed to this Court. Besides it ought to have taken permission of the Committee on Disputes in keeping with the decision rendered by the Supreme Court in ONGC's case (supra) referred to earlier. Neither while filing the writ petition nor till date has the petitioner made any request to the Committee on Disputes for permission to institute or pursue these proceedings.7. Learned Counsel for the petitioner, at this stage, submitted that in order to expedite the completion of the assessment proceedings and avoid any consequent complications, this Court could direct the assessing authority to specifically indicate the nature of information required by it as also the kind of a record which the AO would like to peruse.8. Mr. Malhotra, on the other hand, submitted that the nature of the information required by the assessing authority is already communicated to the petitioner. Even the record which is relevant to the completion of the proceedings has been indicated to the petitioner. He has, however, no objection to the said information and record being once again enumerated in a separate communication which the assessing authority would issue within a period of two weeks from today. That submission is recorded. The assessing authority may indicate once again the nature of information demanded by him as also the records that he wishes to peruse in which event, the petitioner shall furnish the requisite information and produce the relevant record within four weeks thereafter to ensure that the assessment proceedings are finalised expeditiously but not later than three months from the date the requisite information is provided.9. The writ petition is, with the above observations, disposed of.