TRAVELITE Vs. UOI

JUDGEMENT

(1.) The assessee (hereafter "the petitioner") approaches this Court under Article 226 of the Constitution of India, challenging a letter dated 07-11-2012 of the respondent Commissioner seeking records for the period 2007-08 till 2011-12 for scrutiny of an audit party; Rule 5A (2) is also impugned as ultra vires.

(2.) The petitioner is a registered service tax assessee. It is aggrieved by the letter of the Commissioner of Service Tax ("CST") dated 7.11.2012, which sought its records for the years 2007-08 till 2011-12 for scrutiny by an audit party, under Rule 5A(2) of the Service Tax Rules, 1994.The Petitioner also challenges the validity of Rule 5A(2) of the Service Tax Rules, 1994, brought into force by Notification no. 45/2007 dated 28.12.2007 as well as the instruction of the Central Board of Excise and Customs ("CBEC") no. F. No. 137/26/2007-CX.4 dated 1.1.2008. It is contended that the powers of an assessing officer to call for records in respect of any period during which the respondents seek to intensively scrutinize receipts etc. i.e. a special audit can be ordered by recourse to Section 72-A of the Finance Act, 1994. Barring these, the Finance Act, does not contain any substantive power to call for records for scrutiny as is permissible under Rule 5A(2) or for the purpose of scrutiny by any authority outside of those created under the Act, such as the Comptroller and Auditor General's office.

(3.) The petitioner relies on Municipal Corporation v. Birla Cotton, Spinning and Weaving Mills, 1968 AIR(SC) 1232 and General Officer, Commanding in Chief v. Subhash Chandra Yadav, 1988 2 SCC 351, and argues that a rule must conform to the statute under which it was framed, and must be within the rule making power of the authority.