HINDUSTAN STEELWORKS CONSTRUCTION' LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) The question involved in this writ petition is, whether, in the light of the decision of the Hon'ble Supreme Court delivered in the case of Electronics Corporation of India Limited Vs. Union of India & Ors., 2011 3 SCC 404, the appeals, which have been dismissed by the appellate authority for want of clearance from the Committee on Disputes (CoD) constituted in the light of the orders passed by Hon'ble Supreme Court in cases of ONGC - II dated 11.10.1991, ONGC - III dated 7.1.1994 and ONGC - IV dated 20.7.2007, are required to be restored even if they were dismissed prior to the judgment delivered in the case of Electronics Corporation of India Limited ? The brief facts of the case are that the Commissioner, Central Excise and Service Tax, Ranchi, after hearing the petitioner, passed an order in original case no. 99/ST/COMMR/08 dated 31.3.2008, whereby it has been held, inter alia, that the activity of removing/extraction of ash from deposits/ash ponds by the petitioner-company is a cleaning activity and therefore, liable to service tax under "cleaning service". Aggrieved against the said order dated 31.3.2008, petitioner preferred an appeal before the Customs, Excise & Service Tax Appellate Tribunal, East Zonal Branch, Kolkata. The Tribunal found that the petitioner did not obtain any clearance from CoD, which was constituted in purusance of the various orders passed Hon'ble Supreme Court in the cases of Oil and Natural Gas Commission Vs. CCE, 1995 Supp4 SCC 541 decided on 11.10.1991, Oil and Natural Gas Commission Vs. CCE, 2004 6 SCC 437 decided on 7.1.1994 and Oil and Natural Gas Commission Vs. City & Industrial Development Corpn. Maharashtra Ltd., 2007 7 SCC 39 decided on 20.7.2007, which are referred above as ONGC - II, ONGC - III and ONGC - IV cases. Hon'ble Supreme Court in the above cases and particularly in the earlier case of Oil and Natural Gas Commission Vs. CCE, 1992 Supp2 SCC 432 observed that public sector undertakings of the Central Government and the Union of India should not fight their litigations in court and consequently the Cabinet Secretary, Government of India, was called upon to handle the matter personally. The above order was followed by the order dated 11.10.1991 passed in ONGC - II case, wherein Hon'ble Supreme Court directed to set up a Committee consisting of representatives from the Ministry of Industry, Bureau of Public Enterprises and Ministry of Law, to monitor disputes between Ministry and Ministry of Government of India, Ministry and public sector undertakings of the Government of India and public sector undertakings in between themselves, to ensure that no litigation comes to court or to a tribunal without the matter having been first examined by the Committee and its clearance for litigation. Thereafter, in ONGC - III case decided on 7.1.1994, Hon'ble Supreme Court directed that, in absence of clearance from the "Committee of Secretaries" (CoS), any legal proceeding will not be proceeded with and this was made subject to the rider that appeals and petitions filed without such clearance could be filed to save limitation, but it was also directed that the needful should be done within one month from such filing, failing which the matter would not be proceeded with. In ONGC - IV case decided on 20.7.2007, Hon'ble Supreme Court extended the concept of dispute resolution by the High-Powered Committee to amicably resolve the disputes involving the State Governments and their instrumentalities. The idea behind the setting up of this Committee, initially, called a "High-Powered Committee" (HPC), later on called as "Committee of Secretaries" (CoS) and finally termed as "Committee on Disputes" (CoD), was to ensure that resources of the State are not frittered away in inter se litigations between entities of the State, which could be best resolved, by an empowered CoD. Hon'ble Supreme Court considered all these facts in the case of Electronics Corporation of India Limited and observed in paragraph 15 that "the machinery contemplated was only to ensure that no litigation comes to court without the parties having had an opportunity of concilation before an in-house committee."

(2.) In view of the above, learned counsel for the petitioner submitted that, though the petitioner's appeal was dismissed as not maintainable for want of CoD clearance, vide order dated 10.9.2008, however, with liberty to the petitioner to apply for restoration in the appeal after obtaining CoD clearance later on. The petitioner, finding the order dated 10.9.2008 passed by the Tribunal, approached CoD for grant of permission to pursue its appeal but the CoD, by reasoned order dated 21.10.2008, refused permission to the petitioner. The petitioner, aggrieved against the refusal of CoD, preferred review petition on 24.12.2008 with the prayer to review its order dated 21.10.2008 and allow petitioner to pursue appeal as such permission is given to the respondent-Revenue to pursue its appeal before the Tribunal.

(3.) The contention of the learned counsel for the petitioner, Shri Binod Poddar, is that, on the one hand, petitioner has been denied opportunity to pursue its appeal before the Tribunal, whereas permission has been granted to the respondent-Department to challenge the order passed in original side by the Commissioner, Central Excise and Service Tax, Ranchi. Not only this, according to the learned counsel for the petitioner, in the appellate side, in another order, it has been held, that the petitioner is not liable to pay service tax under the same or similar contract. Therefore, according to the learned counsel for the petitioner, the issue is sub-judice, wherein all questions involved are required to be decided by the Tribunal, which are essentially subject-matter in the litigation, may those have been raised by the Revenue or may those have been raised by the petitioner and in the fact situation, the appeal should have been restored by the Tribunal on the application submitted by the petitioner for restoration of the appeal but unfortunately the petitioner's application for restoration of the appeal has been dismissed, vide order dated 26.9.2012. The Tribunal observed that the petitioner's appeal was filed on 14th July, 2008 prior to the decision of Hon'ble Supreme Court delivered in the case of Electronics Corporation of India Limited and petitioner's application for clearance has been rejected by the CoD and the Tribunal in the case of Burn Standard Co. Ltd. Vs. CCE - Kol. - II, vide order dated 17th September, 2012, dismissed the appeal of the assessee in the same facts and circumstances. In sum and substance, the Tribunal was of the view that the petitioner's appeal could not be restored as firstly, it was filed prior to the decision of the Hon'ble Supreme Court rendered in the cases of Electronics Corporation of India Limited and secondly, in the similar facts and circumstances, another appeal of the assessee was dismissed.