Palakuzha Service Co-operative Bank vs Union of India

P.R. Ramachandra Menon, J.

The petitioner has approached this Court with the following prayers:

"(i) To issue a Writ of Certiorari by quashing the illegal and arbitrary Exhibit P3 order.

(ii) To issue a Writ of Mandamus directing the respondents not to proceed further with P3 order.

(iii) To issue a Writ of Mandamus or appropriate order declaring that no service tax is leviable on the agriculture service co-operative bank as it is only a society registered under the Registrar of the Co-operative Society under Government of Kerala, hence not coming under the provisions laid down in the Finance Act, 1994.

(iv) To issue a Writ of Mandamus or appropriate order declaring that no service tax is leviable on the monthly deposit scheme (MDS) facility providing to it''s own society members and on Legal Fees charged by the legal advisers from the customers, which was collected by the petitioner and paid to legal advisers and on Insurance which was collected by the petitioner for Insuring Gold and other valuable articles of customers and paid to the insurance company and on Notice Charges which was the reimbursement of expenses incurred by the petitioner.

(v) To issue a Writ of Mandamus directing the respondent not to assess service tax as the total income for the annual period was below the threshold exemption limit."

The learned counsel for the petitioner submits that, the activities being pursued by the petitioner, who is a Co-operative Bank, do not come within the purview of ''service'', so as to attract any ''service tax'' payable under the relevant provisions of law and hence the proceedings pursued and finalised by the concerned respondent are per se illegal in all respects. It is stated that, the Delhi High Court has already taken a view in favour of the persons like the petitioner herein and that the SLP preferred therefrom stands dismissed by the Hon''ble Apex Court declining interference.

Heard the learned standing counsel appearing for the respondents as well, who points out that the merit of the case has not been considered by the Hon''ble Apex Court and that dismissal of SLP will not result in any ''merger'' so as to have sanctity to the verdict passed by the Delhi High Court, to hold it as upheld by the Apex Court and to have uniform application throughout the country, in terms of the mandate of Article 142 of the Constitution of India. It is also brought to the notice of this Court that similar assessees had already approached this Court at different points of time raising similar contention and that the said parties have been relegated to pursue the remedy before the competent authorities under the Statute. The learned counsel for the petitioner points out that the said parties had approached this Court at the stage of notice and not after passing the orders. This does not make any difference in so far as the petitioner is having an effective alternate remedy under Section 85 of the Finance Act, as made clear in the opening paragraph of the impugned order itself. That apart, the merit of the case has to be considered with reference to the facts and figures and this Court does not find it necessary to act as a ''fact finding agency''; more so when, the petitioner is having other appropriate Forum to establish the same in accordance with law. In the said circumstances, the petitioner is relegated to pursue the matter by way of appeal, if so advised. Interference is declined and the writ petition is dismissed without expressing any opinion with regard to the points raised by the petitioner.