GANESH YADAV Vs. UNION OF INDIA AND ORS.

JUDGEMENT

(1.) The petitioner claims to have provided between 2007-08 and 2011-12 the service of the construction of flats to Varanasi Development Authority under the Manyavar Kanshi Ram Saheri Garib Awas Yojna. On 19 September 2013, a notice to show cause was issued to the petitioner by the Additional Commissioner, Central Excise, Customs and Service Tax, Allahabad, seeking to demand an amount of Rs. 34.02 lacs as service tax on the ground that the petitioner was providing a taxable service for which it was not registered. The amount was demanded and stated to be recoverable under the proviso to Section 73(1) of the Finance Act, 1994 together with interest and penalty. In the course of the adjudication proceedings, an order was passed on 31 March 2015 by the Additional Commissioner, Central Excise, Customs and Service Tax, Allahabad, confirming the demand of service tax in the amount of Rs.34.02 lacs. This was accompanied by a penalty under Sections 70, 76, 77 and 78 of the Finance Act, 1994. Section 35F of the Central Excise Act, 1944 has been made applicable by virtue of Section 83 of the Finance Act, 1994. Section 35F of the Act was amended by Finance (No. 2) Act, 2014 and reads as follows:

(2.) Prior to the amendment of Section 35F of the Act, the provision as it stood earlier, was as follows:

(3.) The petitioner has sought in these proceedings a writ restraining the respondents from enforcing the mandatory requirement of a pre-deposit of 7.5% of the duty demanded in pursuance of the order of adjudication dated 31 March 2015. The second relief is for a declaration that Section 35F of the Act, as amended with effect from 6 August 2000, so as to provide a mandatory pre-deposit of 7.5% for first appeals and 10% to second appeals of the total tax or penalty demanded, is ultravires or unconstitutional.