Case: M/s The Freyssinet Prestressed Concrete Co. Ltd. v. Union of India & Ors., Patna High Court, CWJC No. 13714 of 2024, Judgment dated 13.02.2025
Category: Service Tax demand (works contract classification and limitation)
Relevant Sections: Section 73(1), Section 75, Section 77(1)(a), Section 78 of Finance Act, 1994 read with Section 174 of CGST Act, 2017; Section 65(105)(zzzza) of Finance Act, 1994.
Facts (Para 2–8)
The petitioner, engaged in bridge construction, challenged an ex parte order dated 13.03.2024 by the Principal Commissioner of Central GST and Central Excise, Patna. The order created a service tax demand of ₹4.57 crore (2006–07 to 2009–10) with interest and penalty under Sections 73, 75, 77, and 78 of the Finance Act, 1994 read with Section 174 of CGST Act.
Earlier, the petitioner had assailed the show cause notice of 2009 in CWJC No. 9292 of 2010, which was disposed of in 2021 granting liberty to avail alternate remedies. The grievance was that after years of inaction, the department revived proceedings in 2024, which the petitioner alleged was time-barred under Section 73(4B). The petitioner argued that works contracts for bridges fell under exempt services (Section 65(105)(zzzza)) and cited exemption Notification 24/2009 for road repair.
Questions / Dispute (Para 6–8)
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Whether the service tax demand raised for bridge construction/repair was barred by limitation under Section 73.
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Whether such works contracts were excluded from the ambit of taxable service under Section 65(105)(zzzza).
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Whether the department’s order was illegal for being passed ex parte and without jurisdiction.
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Whether writ jurisdiction was maintainable despite the statutory appellate remedy.
Observations (Para 12–15)
The Court noted that the petitioner had already deposited 7.5% pre-deposit, showing intention to pursue statutory appeal. The objections raised (limitation, exemption, jurisdiction) could be agitated before the Appellate Authority. The Court referred to Godrej Sara Lee Ltd. v. Excise and Taxation Officer (2023 SCC OnLine SC 95, para 4) reiterating that while writ jurisdiction is not ousted by alternate remedy, High Courts ordinarily refrain from interfering where efficacious appellate remedies exist. The petitioner’s apprehension that the Appellate Authority may not consider fresh evidence was rejected, as the statute imposed no such bar.
Judgment / Verdict (Para 16–19)
The Court declined to entertain the writ petition, relegating the petitioner to the appellate remedy. It directed that if an appeal is filed within eight weeks, the Appellate Authority must consider it, and in computing limitation, the time spent pursuing the writ petition since 19.08.2024 would be excluded. The Court further ordered that no coercive action would be taken for eight weeks.
Table of Earlier Case Referred
| Case | Citation | Verdict |
|---|---|---|
| Godrej Sara Lee Ltd. v. Excise and Taxation Officer-cum-Assessing Authority | 2023 SCC OnLine SC 95 | Supreme Court held that writ jurisdiction is discretionary; alternative remedies ordinarily to be pursued, but availability of remedy does not make writ “not maintainable.” |
Between Fine Lines
This ruling underscores that High Courts will not interfere in service tax or GST demands if appellate remedies exist. Businesses must be cautious: even if orders are ex parte or delayed, the first remedy lies in appeal. Importantly, the Court allowed exclusion of writ-pursuing time for limitation, protecting taxpayers from being prejudiced for bona fide litigation choices.
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