VEER BHADRA SINGH Vs. UNION OF INDIA

JUDGEMENT

(1.) The challenge in the present writ petition is with regard to the sustainability of the show cause notice (Annexure P/1), with regard to the alleged non-satisfaction of the license fee coupled with various other aspects. Paragraph 15 of the said notice is to the following effect :-

(2.) Heard Mr. Neelabh Dubey, learned counsel appearing for the petitioner at length. Various grounds have been raised in the writ petition with regard to the constitutional mandate, especially with regard to Article 366 29 (A) of the Constitution of India, apart from defining the term "service" under Section 65 B (44) of the Finance Act , 1994 (henceforth, "Act of 1994"), the liability to pay the service tax under the Act of 1994 and such other provisions. Reference is also made to the taxing power in relation to the various Entries, particularly Entry 92C, coming in List I, Seventh Schedule, which is within the exclusive power and jurisdiction of the Central Government, in contrast to the taxing power of the State under Entry 8, Entry 51 and Entry 54 of List II.

(3.) Learned counsel for the petitioner vehemently argues that by virtue of law and in view of the binding decisions rendered by the Apex Court, the same transaction cannot involve a 'sale' as well as a 'service'. In the instant case, the petitioner is a dealer engaged in sale of English and countrymade liqour through the retail outlets in the group Uslapur and has been granted the license by the State to do the said exercise. Of course, license fee is to be paid to the State, which according to the petitioner, is fixed on the basis of the minimum quantum of liqour that has to be lifted, and this being the position, it is part of the revenue that is generated because of the sale and hence, this cannot be subject to service tax under any circumstance. It is in the said context, that the petitioner has made an endeavour to approach this Court to get the show-cause notice quashed, with reference to the pleadings on the grounds as aforesaid.