Soumitra Pal, J. - (1.) IN the writ petition the petitioner No. 1, stated to be a leading public house in the country and, inter alia, engaged in the business of printing and publishing a wide range of newspapers and periodicals and the petitioner No. 2, a citizen of India and share holder of the petitioner No. 1, have challenged the notice dated 1/4 -12 -2006 (for short "the notice") issued by the Assistant Commissioner (SIV) Service Tax, Kolkata, respondent No. 2, requesting the petitioner No. 1 to furnish certain documents mentioned therein with regard to the information regarding taxability of its activity under the category of Business Auxiliary Service (for short 'BAS') under the Finance Act, 1994. It may be noted that provisions for service tax have been made in Sections 64 to 96 -I (Chapters V. and VA) of the Finance Act, 1994. In the writ petition it has been stated that the petitioner No. 1, registered under the Service Tax with regard to eight activities, have been regularly filing service tax returns and paying tax thereto. According to the petitioner, in view of several exemptions granted by notifications and circulars, the commercial activity of printing, publishing and selling newspapers and periodicals and selling of advertisement space in print media does not fall under the category of BAS. It has been stated that the impugned notice is based on suspicion as it has been mentioned that the commercial activities may fall under category of BAS. Since the entire nature of commercial activities is known to the service tax authorities as apparent from the notice itself and from the returns filed, and since such commercial activities do not fall under the category of BAS, the documents sought for are not relevant. Moreover, the notice impugned is vague and thus the inquiry is fishing and roving in nature.
(2.) LEARNED senior advocate appearing on behalf of the petitioner relying on the statements in the writ petition submitted that since in the affidavit -in -opposition it has been stated that the authorities have reasons to believe that the petitioner is carrying on BAS activities, the respondents ought to have disclosed what had prompted them to issue such notice. Submission is that the letter dated 20 -12 -2006 sent on behalf of the petitioner No. 1 in reply to the notice does not preclude the petitioner from challenging the same. Learned senior advocate for the petitioner had relied on several judgments which shall be dealt with in appropriate stage. Learned advocate for the respondents justifying the action has submitted that Section 83 of the Finance Act, 1994 read with Section 14 of the Central Excise Act, 1944 (for short the "Central Excise Act") authorise the respondent to issue such notice. Since Finance Act, 1994 is a special Act and Section 14 of the Central Excise Act do not contain the words 'reason to believe', the judgments relied on by the petitioner are not applicable to the facts of the case. Moreover, the instant writ petition is not maintainable since it is evident from the reply dated 20 -12 -2006 that the petitioner No. 1 had submitted to the jurisdiction of the authority as it had understood the purport of the notice and request was made to grant time for compliance.
(3.) IN order to appreciate the issue it is necessary to refer to the impugned notice dated 1/4 -12 -2006, the relevant portion of which is as under: - It is suspected that your commercial activity may fall under the category of 'Business Auxiliary Service (BAS)', the definition of which provided under Section 65(19) of the Finance Act, 1994 as "Business Auxiliary Service means any service in relation to - (i) promotion or marketing or sale of goods produced for provided by or belonging to the client; or (ii) promotion or marketing of service provided by the client; or (iii) any customer care service provide on behalf of the client; or (iv) procurement of goods or services, which are inputs for the client; (v) production of goods on behalf of the client; or provision of service on behalf of the client; or a service incidental or auxiliary to any activity specified in Sub -clauses (i) to (vi), such as billing, issue or collection or recovery of cheques, payments, maintenance of accounts and remittance, inventory management, evaluation or development of prospective customers or vendor, public relation service, management or supervision, and includes services as commission agent. In this regard, an inquiry has been initiated, for which you are requested to furnish the following documents related to the last 3 financial years, within 5 days of receipt of this letter. 1. Brief declaration of all your commercial activities, nature of relationship with the present group, and mode of reimbursements/payments of any kind received by you. 2. Monthwise figures of all considerations (cash or kind) received by you for the services provided. 3. Balance sheet and audited books of account of your concern and your present group. 4. Copy of Service tax registration certificate and returns submitted.;