Ram Karan Fadak And Ors vs Union Of India And Ors

The question involved in this writ petition is as to the leviability of the service tax under the Finance Act, 1994 for the activity of extraction of minerals. A Division Bench in Udaipur Chambers of Commerce and Industry vs. Union of India [D.B. Civil Writ Petition No.14578/2016, vide order dated 24.10.2017] held that the service tax is leviable on the activity, with respect to the royalty payable to the State Government and that Section 65-B(44) in no way impact the charge.

The appellant urges that the judgment in Udaipur Chambers of Commerce and Industry (supra) has been stayed by the Supreme Court in the proceedings on appeal in SLP(C) No.37326/2017, vide order dated 11.01.2018.

In view of the declaration of law in Udaipur Chambers of Commerce and Industry (supra), the claim in the petitioners cannot be permitted. Following Udaipur Chambers of Commerce and Industry (supra) it is held that the service tax is leviable. However, the Court also notices that the Supreme Court is seized of the matter in SLP before it. The final recovery of the service tax shall be in accordance with final judgment of the Supreme Court which the parties shall be bound by.

The writ petition is accordingly dismissed.