Remanded

M/S. Dahakodi Chitts Private Limited v. Union of India

Kerala HC22 Nov 2018WP(C)/31340/2016

Case brief

AI extract

What is this about?

The Court held that service tax is not payable on Chit Funds for periods before the 2015 amendment defining service. It remanded the matter for fresh adjudication and stayed the interim order pending fresh determination.

What did the court decide?

The interim order dated 28/09/2016 shall not be enforced till fresh adjudication is conducted conforming to the law laid down.

M/S. Dahakodi Chitts Private Limited Vs Union of India — GST and Indirect Tax | Kerala HC (2018)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR.JUSTICE V.G.ARUN

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THURSDAY ,THE 22ND DAY OF NOVEMBER 2018 / 1ST AGRAHAYANA, 1940

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WP(C).No. 31340 of 2016

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PETITIONER:

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M/S. DHANAKODI CHITTS PRIVATE LIMITED CITY TOWERS, GANDHI JUNCTION,SULTHANBATHERY, WAYANAD PIN-673592 REP. BY ITS MANAGING DIRECTOR M.M.YOHANNAN

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BY ADVS. SRI.LINDONS C.DAVIS SMT.E.U.DHANYA SMT.REMYA P.SASIDHARAN RAJITHDAVIS ATTATHARA

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RESPONDENTS:

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1 UNION OF INDIA REP. BY THE SECRETARY TO GOVERNMENT, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE , NORTH BLOCK, NEW DELHI-110001

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2 CENTRAL BOARD OF EXCISE & CUSTOMS DEPARTMENT OF REVENUE,MINISTRY OF FINANCE,156, NORTH BLOCK 1,NEW DELHI-110001

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3 CHIEF COMMISSIONER OF CENTRAL EXCISE AND CUSTOMS CENTRAL REVENUE BUILDING, I.S.PRESS ROAD, COCHIN – 682 018

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4 ASSISTANT COMMISSIONER OF CENTRAL EXCISE AND CUSTOMS CALICUT DIVISION, E.R.BUILDING, MANANCHIRA, CALICUT – 673001

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BY ADVS.

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SREELAL N. WARRIER, SC, CENTRAL BOARD OF EXCISE & CUSTOM

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THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 22.11.2018, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WP(C).No. 31340 of 2016

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V.G.ARUN, J.

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----------------------------------W.P.(C) No. 31340 of 2016

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Dated this the 22^nd day of November, 2018

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J U D G M E N T

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The issue canvassed in this Writ Petition pertains to the demand for service tax for the period 2012-13 and 201314. The question as to whether companies like the petitioner who are engaged in Chitty business are exigible to service tax was considered by the Hon'ble Supreme Court in Union of India and others v. M/s.Margadarshi Chit Funds (P)

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Ltd. etc (AIR 2017 SC 3730). It was laid down in the said decision that after the amendment brought about to the definition of the word 'service' from 15/06/2015 onwards, service tax is payable on Chit Fund. Relying on the decision of the Hon'ble Supreme Court, a Division Bench of this court in its judgment in Writ Appeal No.273 of 2013 held that the amendment brought about to the definition of service cannot be said to be clarificatory and there can be no retrospective operation given to such amendment. As a corollary it has to

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WP(C).No. 31340 of 2016

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be understood that service tax could not be levied on Chit Funds prior to the amendment. In the light of the undisputed fact that the demand made under Ext.P8 takes in demands for the period 2012-13 and 2013-14, it is only appropriate to remand the matter to the adjudicating authority for fresh adjudication in the light of the law as laid down by the Hon'ble Supreme Court and followed by the Division Bench of this Hon'ble Court. For the purpose of such adjudication, necessarily an opportunity of hearing should be offered to the petitioner. The interim order granted on 28/09/2016 shall not be enforced till orders are passed in the fresh adjudication to be conducted, consequent to this judgment.

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The Writ Petition is disposed of as above.

Sd/-

V.G.ARUN JUDGE

WP(C).No. 31340 of 2016

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APPENDIX

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PETITIONERS' EXHIBITS:

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EXHIBIT P1: TRUE COPY OF NOTIFICATION NO.20/2012-ST DATED 05.06.2012 EXHIBIT P2: TRUE COPY OF THE NOTIFICATION NO.26/2012 DATED 20.06.2012 EXHIBIT P3: TRUE COPY OF THE JUDGMENT OF THE HON'BLE HIGH COURT OF DELHI DATED 23.04.2013 IN W.P.C. 4512/2012. EXHIBIT P4: TRUE COPY OF THE ORDER PASSED BY THE HON'BLE SUPREME COURT IN SLP (C)NO.24998/2013 DATED. 07.01.2014 EXHIBIT P5: TRUE COPY OF SHOW CAUSE NOTICE 39/2015 ON 31.03.2015 EXHIBIT P6: TRUE COPY OF SHOW CAUSE NOTICE 60/2015 DATED 21.04.2015 EXHIBIT P7: TRUE COPY OF THE REPLY TO SHOW CAUSE NOTICE 39/2015 EXHIBIT P8: TRUE COPY OF THE ORDER IN ORIGINAL NO.315 & 316/2015-16 ST DATED 30.03.2016 EXHIBIT P9: TRUE COPY OF THE INTERIM ORDER PASSED BY THIS HON'BLE COURT IN W.P. (C)NO.13686/2015 ON 07.10.2015

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RESPONDENTS' EXHIBITS: NIL

M/S. Dahakodi Chitts Private Limited v. Union of India

Case brief

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M/S. Dahakodi Chitts Private Limited v. Union of India

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