Madras High Court
P.Muthurakku vs The Chairman And Managing ... on 17 November, 2021
W.P.(MD)No.20526 of 2021
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 17.11.2021
CORAM:
THE HONOURABLE MR.JUSTICE M.SUNDAR
W.P.(MD)No.20526 of 2021
and
W.M.P.(MD)No.17161 of 2021
P.Muthurakku ... Petitioner
Vs.
1.The Chairman and Managing Director,
Tamil Nadu Small Industries Development Corporation Ltd.,
SIDCO Corporate Office Building,
Thiru-Vi-Ka Industrial Estate,
Guindy, Chennai – 32.
2.The Branch Manager,
Tamil Nadu Small Industries Development Corporation Ltd.,
SIDCO Branch Office,
Thondi Road,
Sivagangai. ... Respondents
PRAYER: Writ Petition filed under Article 226 of the Constitution
of India for issuance of Writ of Certiorarified Mandamus, calling for
the records pertaining to the impugned show cause notice issued
https://www.mhc.tn.gov.in/judis
1/12
W.P.(MD)No.20526 of 2021
by the second respondent dated 08.11.2021 in Rc.No.357/C/2019
and quash the same as illegal and consequently direct the second
respondent grant sufficient time to pay the remaining cost for the
Developed Plot Nos.28 and 29 in SIDCO Industrial Estate,
Sivagangai as per the allotment order dated 22.11.2021 in
Allotment Order No.6111/IE4/2019 by taken into consideration for
the representation of the petitioner dated 11.11.2021.
For Petitioner : Mr.G.Aravinthan
for Mr.A.Mohan
For Respondents : Mr.T.Sakthi Kumaran
Standing Counsel
ORDER
***********
Captioned main writ petition has been filed assailing a show
cause notice dated 08.11.2021, bearing Reference No.357/C/2019
issued by the second respondent. This show cause notice shall
hereinafter be referred to as 'impugned SCN' for the sake of
convenience and clarity.
2.Mr.G.Aravinthan, learned Counsel representing the Counsel
on record for the writ petitioner submits that the first respondent
had allotted developed plots bearing Nos.28 & 29, measuring an
extent of 0.87 acre or thereabouts in SIDCO Industrial Estate at
https://www.mhc.tn.gov.in/judis
W.P.(MD)No.20526 of 2021
Sivagangai on 22.11.2019, at a cost of over 50 Lakhs. Suffice to say
that the aforesaid cost had to be paid by writ petitioner to SIDCO in
a phased manner. It is not necessary to dilate into those factual
details owing to the narrow compass on which captioned matter
turns.
3.Notwithstanding very many averments in the writ affidavit
and notwithstanding several grounds raised in the writ affidavit at
the hearing (assailing the impugned SCN), learned Counsel for writ
petitioner submitted that the writ petitioner has sent a
representation dated 11.11.2021, inter alia highlighting the corona
virus pandemic and consequent lock down [hereinafter 'Covid-19
situation', collectively] and seeking extension of timelines qua
payments.
4.Learned Counsel for writ petitioner submits that the
Covid-19 situation is something which could none could either
portend or presage. As far as the challenge to the impugned SCN is
concerned, learned Counsel submits that the impugned SCN has
been issued without considering the writ petitioner's
representation dated 27.09.2021 which is at page 11 of the typed
set of papers and the same is as follows:
https://www.mhc.tn.gov.in/judis
W.P.(MD)No.20526 of 2021
https://www.mhc.tn.gov.in/judis
W.P.(MD)No.20526 of 2021
5.Mr.T.Sakthi Kumaran, learned Standing Counsel accepts
notice on behalf of both the respondents.
6.Owing to the short point on which captioned main writ
petition turns with the consent of the learned Counsel on both
sides, the main writ petition is being taken up, heard out and
disposed of.
7.Learned Standing Counsel for SIDCO submits that the writ
petitioner has submitted himself to the jurisdiction by replying to
the impugned SCN. It is pointed out that the reply is dated
12.11.2021.
8.Before proceeding further, I am clear in my mind that
challenge to a SCN in writ jurisdiction can only be only on very
limited grounds ie., jurisdictional issue, Natural Justice Principle
['NJP' for brevity] violation, disregarding settled principle of laws to
mention some of the exceptional circumstances under which a Writ
Court will interfere qua challenge to an SCN. One of the recent
case laws on this point is Coastal Container Transporters
Association case {order dated 26.02.2019 in Civil Appeal No.
https://www.mhc.tn.gov.in/judis
W.P.(MD)No.20526 of 2021
2276 of 2019}. Facts are captured in paragraph No.4 and ratio
(capturing line of authorities) is set out in paragraph No.19.
Paragraph 4 and paragraph 19 read as follows:
'4. Necessary facts, in brief, are as under :
First respondent is an association,
whose members are transport operators engaged
in the business of transportation of goods
entrusted by the customers. By way of impugned
show cause notices, the appellants have
proposed to demand service tax from the
respondents under the category of “cargo
handling service”, while it is the case of the
respondents that the service which is being
provided by them, falls under the taxable
category of “goods transport agency”. The
respondents, to bolster their case, have placed
reliance upon circulars dated 06.08.2008 and
05.10.2015 issued by the Central Board of Excise
and Customs (CBEC).
Based upon the intelligence gathered by
the officers of Rajkot Regional Unit, which
revealed that several business entities including
respondent nos.2 and 3 who are engaged in
doing the business of cargo handling in west
coastal region but had got themselves registered
under “good transport agency”, by taking
approval from the competent authorities,
searches were conducted in the premises of
respondent nos.2 and 3. It is alleged that during
https://www.mhc.tn.gov.in/judis
W.P.(MD)No.20526 of 2021
such searches several incriminating documents,
including the quotations submitted by the
respondent- companies to their customers were
seized and statements of the Directors were
recorded as per the provisions of Central Excise
Act, 1944 read with the provisions under Finance
Act, 1994. Subsequently, the show cause notices
dated 08.10.2015 and 30.09.2015, were issued to
respondent nos.2 and 3, which are impugned in
the writ petition filed before the High Court.
5. to 18. .....
19. On the other hand, we find force in the
contention of the learned senior counsel, Sri
Radhakrishnan, appearing for the appellants that
the High Court has committed error in
entertaining the writ petition under Article 226
of Constitution of India at the stage of show
cause notices. Though there is no bar as such for
entertaining the writ petitions at the stage of
show cause notice, but it is settled by number of
decisions of this Court, where writ petitions can
be entertained at the show cause notice stage.
Neither it is a case of lack of jurisdiction nor any
violation of principles of natural justice is alleged
so as to entertain the writ petition at the stage of
notice. High Court ought not to have entertained
the writ petition, more so, when against the final
orders appeal lies to this Court. The judgment of
https://www.mhc.tn.gov.in/judis
W.P.(MD)No.20526 of 2021
this Court in the case of Union of India & Anr.
v. Guwahati Carbon Ltd. (supra) relied on by
the learned senior counsel for the appellants also
supports their case. In the aforesaid judgment,
arising out of Central Excise Act, 1944, this
Court has held that excise law is a complete code
in order to seek redress in excise matters and
held that entertaining writ petition is not proper
where alternative remedy under statute is
available. When there is a serious dispute with
regard to classification of service, the
respondents ought to have responded to the
show cause notices by placing material in
support of their stand but at the same time, there
is no reason to approach the High Court
questioning the very show cause notices.
Further, as held by the High Court, it cannot be
said that even from the contents of show cause
notices there are no factual disputes. Further,
the judgment of this Court in the case of Malladi
Drugs & Pharma Ltd. v. Union of India, relied
on by the learned senior counsel for the
appellants also supports their case where this
Court has upheld the judgment of the High Court
which refused to interfere at show cause notice
stage.'
[Extracted and reproduced as such]
https://www.mhc.tn.gov.in/judis
W.P.(MD)No.20526 of 2021
9.In the case on hand, none of those exceptions much less
exceptional circumstances obtain. This itself will draw the curtains
on the captioned writ petition. However, as the request for
extension of time is based on Covid-19 situation which the writ
petitioner could neither portent nor presage, this Court considers it
appropriate to dispose of the captioned writ petition in the
following manner:
a) The impugned show cause notice
dated 08.11.2021 bearing Reference No.
357/C/2019 is not interfered with. To put it
differently, it is sustained. It will proceed
and will be carried to its logical end.
b) Writ petitioner's reply to impugned
SCN dated 12.11.2021 shall be considered
along with the aforementioned 27.09.2021
representation of the writ petitioner. In
other words, the writ petitioner's reply to
impugned SCN and the representation
dated 27.09.2021 will be treated as integral
part and parcel of one another.
https://www.mhc.tn.gov.in/judis
W.P.(MD)No.20526 of 2021
c) Respondent SIDCO shall pass
orders on the basis of the aforementioned
reply / representation considering both as
reply to SCN as expeditiously as the
business of the respondents would permit
but in accordance with law and on the
merits of the matter.
d) The order passed in the aforesaid
manner shall be duly communicated to the
writ petitioner within seven [7] working
days from the date of the order.
e) No precipitative action shall be
taken by the SIDCO until service of the
disposal order on the writ petitioner in the
aforesaid manner.
f) If the order disposing of the
proceedings is adverse to the writ
petitioner, the precipitative action shall
remain in abeyance for one week from date
of service of the proceedings on the writ
petitioner.
https://www.mhc.tn.gov.in/judis
W.P.(MD)No.20526 of 2021
10.Captioned writ petition is disposed of with the aforesaid
directives in the aforesaid manner. Consequently, captioned Writ
Miscellaneous Petition is disposed of as closed. There shall be no
order as to costs.
17.11.2021
Index : Yes / No
Internet: Yes / No
MR
NOTE: In view of the present lock down
owing to COVID-19 pandemic, a
web copy of the order may be
utilized for official purposes, but,
ensuring that the copy of the order
that is presented is the correct copy,
shall be the responsibility of the
advocate/litigant concerned.
To
1.The Chairman and Managing Director,
Tamil Nadu Small Industries Development Corporation Ltd.,
SIDCO Corporate Office Building,
Thiru-Vi-Ka Industrial Estate,
Guindy, Chennai – 32.
2.The Branch Manager,
Tamil Nadu Small Industries Development Corporation Ltd.,
SIDCO Branch Office,
Thondi Road, Sivagangai.
https://www.mhc.tn.gov.in/judis
W.P.(MD)No.20526 of 2021
M.SUNDAR., J.
MR
ORDER MADE IN
W.P.(MD)No.20526 of 2021
17.11.2021
https://www.mhc.tn.gov.in/judis
