AB ENTERPRISES Vs. UNION OF INDIA

JUDGEMENT

(1.) The present challenge under Sec. 34 of the Arbitration and Conciliation Act, 1996, bearing AP-COM No. 522 of 2024, has been preferred by the South Eastern Railway against an award directing the petitioner/Railway to reimburse Service Tax to the respondent to the tune of Rs.49,53,763.00 along with interest paid by the respondent to the Tax Authorities.

(2.) The short background of the case is that the respondent participated in a tender floated on April 14, 2015 by the petitioner/Railway for escorting job of coach attendant for bed-roll distribution for various trains at Santragachi Coaching Depot for a period of one year. The respondent participated and came out successful. Accordingly, a Letter of Award (LoA) was issued to the respondent on June 25, 2015 and consequentially an agreement was executed between the parties on September 26, 2015. The respondent completed the work and raised invoices and was paid the dues for such work by the petitioner.

(3.) On November 17, 2017, a show-cause notice was issued by the Tax Authorities to the respondent claiming Service Tax on the work done under the contract, along with interest. The respondent ultimately paid the dues at a discounted rate under the Sabka Vishwas Legacy Dispute Resolution Scheme, 2019 and made a demand for such amount from the petitioner. The petitioner having not acceded to such claim, the matter was referred to arbitration, the respondent claiming the entire amount of Service Tax and interest paid thereon.