Disposed

P Saravanan v. The State Tax Officer

Madras HC9 Jul 2024WP/16624/2024

Case brief

AI extract

What is this about?

Petition challenging GST levy on mining lease amount. Court directed petitioner to submit objections within four weeks and kept adjudication orders in abeyance pending the Supreme Court's Nine Judge Constitution Bench decision on royalty nature, following previous Division Bench directions.

What did the court decide?

Permitted to submit reply/objections within four weeks; adjudication kept in abeyance.

P Saravanan Vs The State Tax Officer — Mining and Natural Resources | Madras HC (2024)

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W.P.No.16624 of 2024

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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DATED : 09.07.2024

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CORAM

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THE HONOURABLE MR.JUSTICE SENTHILKUMAR RAMAMOORTHY

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W.P.No.16624 of 2024 and W.M.P.Nos.18242 & 18243 of 2024

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P.Saravanan Proprietor of Sri Vaishnavi Traders, 1/3, Chinnapoolapatti Village, Kottumaranahalli (Post), Karimangalam Taluk, Dharmapuri District-635 205. ... Petitioner

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-vs-

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The State Tax Officer, Inspection Cell-5, Hosur, Office of the Joint Commissioner (ST) (Intelligence), 3/47, Sapthagiri Complex, Commercial Taxes Building, 2^nd floor, Gandhi Nagar, Near Five Star Petrol Bunk, Hosur-635 109. ... Respondent

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Prayer : Writ Petition filed under Article 226 of the Constitution of India, to issue a Writ of Certiorari calling for the records relating to the impugned order of the respondent in 1/7

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https://www.mhc.tn.gov.in/judis

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W.P.No.16624 of 2024

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Ref:GSTIN:33BNPPS5810R1Z6/2018-2019, dated 07.05.2024 for levy

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and demand of GST on the lease amount for grant of mining lease,

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quash the same.

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For Petitioner : Mr. V.Sanjeevi

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For Respondent : Mrs.K.Vasanthamala, Govt. Adv. (T)

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ORDER

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In this writ petition, the petitioner has assailed the impugned

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order levying GST in respect of the mining lease amount paid by the petitioner to the Government.

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Learned counsel for the petitioner relies on Notification

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No.13/2017 - Central Tax (Rate) insofar as the claim relates to GST on

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mining lease and points out that services supplied by the Central, State Government or local authority to a business entity by way of

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renting of immovable property is excluded from GST. Reliance is

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2/7

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https://www.mhc.tn.gov.in/judis

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W.P.No.16624 of 2024

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also placed on interim orders issued by the Hon'ble Supreme Court in a batch of cases, including SLP(C) No.37326 of 2017 to contend that the Supreme Court has granted an interim stay not only in respect of royalty but also in respect of mining lease. It is stated that the nine judge bench is scheduled to hear the batch of cases.

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Learned counsel further placed for consideration the Division Bench Judgment in a batch of cases where the lead case is A.Venkatachalam v. Assistant Commissioner (ST), Palladam , in W.P.No.30974 of 2022 .

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Mrs.K.Vasanthamala, learned Government Advocate, accepts notice for the respondent.

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The Division Bench of this Court issued the following directions at paragraph 9 of the judgment:

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"9. In these circumstances, we deem it fit and appropriate to issue the

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3/7

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https://www.mhc.tn.gov.in/judis

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W.P.No.16624 of 2024

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following directions:

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(i) In the cases, where the challenge is made to the show cause notices, the writ petitioners shall submit their objections / representations within a

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period of four weeks from the date of receipt of a copy of this order.

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(ii) Upon receipt of the objections / representations from the writ petitioners, the authority concerned shall proceed with the adjudication, on merits and in accordance with law, after affording reasonable opportunity of being heard to the petitioners. However, the orders of adjudication shall be kept in abeyance until the Nine Judge Constitution Bench decides the issue as to the nature of royalty.

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(iii) It is made clear that there shall be no recovery of GST on royalty until the Nine Judge Constitution Bench takes a decision.

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(iv) Needless to state that on the matters being decided, the writ petitioners if still aggrieved, shall redress their grievance(s), if any, before the appropriate forum, including by filing appeal(s).

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(v) Insofar as the challenge to the notification as well as the circular, it is open to the writ petitioners to act upon, after the outcome of the case pending before the Nine Judge Constitution Bench.

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4/7

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https://www.mhc.tn.gov.in/judis

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W.P.No.16624 of 2024

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(vi) It is also made clear that all the contentions are left open for the

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writ petitioners to raise in appropriate proceedings, after the outcome of the decision of the Nine Judge Constitution Bench."

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In view of the said judgment, this petition is liable to be disposed of on the same terms. Consequently, in this case, the petitioner is permitted to submit his reply to the intimation within a maximum period of four weeks from the date of receipt of a copy of this order.

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