SUSHILA Vs. AIRPORT AUTHORITY OF INDIA

JUDGEMENT

(1.) The appellant/petitioner is aggrieved by a common order dated 15.9.2017, passed in W.P. (C) Nos. 10880/2019 and 10883/2016 whereby, her plea for issuing a writ of mandamus to the respondent No.1/Airports Authority of India (AAI) and the respondent No.2/Delhi International Airport Limited (DIAL) for return of Fixed Deposit Receipts (FDRs) retained by the said authorities against Service Tax liabilities that would have been attracted on the revenue generated from the contracts executed between the parties, has been disposed of with an observation that since there is an arbitration clause contained in the contract, the appellant has a remedy of invoking the said clause and raising her disputes before the Arbitral Tribunal.

(2.) Briefly stated, the relevant facts of the case are that on 20.07.2005, the appellant had entered into a License Agreement with the respondent No.1/AAI and later, on 19.06.2006, had entered into a License Agreement with the successor-in-interest of AAI, respondent No.2/DIAL on similar terms for removal or disposal of garbage from various designated points falling within the premises of the IGI Airport at New Delhi. An issue arose as to whether Service Tax was leviable on garbage disposal charges payable by the respondents to the appellant/petitioner. Pending adjudication of the said issue before the Service Tax Department, the respondents withheld the security deposits in the form of FDRs offered by the appellant/petitioner to the tune of Rs.17,28,000/-, the subject matter of LPA 688/2017 and Rs.28,51,200/-, the subject matter of LPA 686/2017.

(3.) The office of the Commissioner of Service Tax, New Delhi served notices to show cause on the respondents regarding non-payment of Service Tax on the service of garbage removal rendered by the appellant. While the said proceedings were still pending, the appellant filed a writ petition in the High Court, registered as W.P. (C) 15096/2006, inter alia challenging the applicability of Service Tax in respect of the agreement entered into with the respondent/AAI. Besides the appellant/petitioner herein, several other persons who had entered into agreements with the respondent/AAI, also filed writ petitions challenging the application of Clause (zzm) inserted in Section 65 (105) of the Finance Act, 1994 w.e.f. 1.4.2004 that had extended the definition of "taxable services" to be provided "to any person, by airports authority or by any other person, in any airport or a civil enclave:.............PROVIDED that the provisions of Section 65A shall not apply to any service when the same is rendered wholly within the airport or civil enclave."