Service Tax – Exemption Notification Should Not Be Liberally Construed; Assessee Has To Show That He Comes Within Its Purview
Case: Krishi Upaj Mandi Samiti, New Mandi Yard, Alwar vs Commissioner of Central Excise and Service Tax, Alwar
Coram: Coram: Justices MR Shah and BV Nagarathna
Case No.: CA 1482 of 2018
Court Observation: Now, so far as the submission on behalf of the respondent that in the event of ambiguity in a provision in a fiscal statute, a construction favourable to the assessee should be adopted is concerned, the said principle shall not be applicable to construction of an exemption notification, when it is clear and not ambiguous. Thus, it will be for the assessee to show that he comes within the purview of the notification. Eligibility clause, it is well settled, in relation to exemption notification must be given effect to as per the language and not to expand its scope deviating from its language. Thus, “If the statute mandates that the Market Committees have to provide the land/shop/platform/space on rent/lease then and then only it can be said to be a mandatory statutory obligation otherwise it is only a discretionary function under the statute. If it is discretionary function, then, it cannot be said to be a mandatory statutory obligation/statutory activity. Hence, no exemption to pay service tax can be claimed.”
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