Debangsu Basak, J. - (1.) The petitioner has assailed a show-cause notice dated October 16, 2007 issued by the respondent no. 1. The petitioner has also challenged the provisions of Sections 65(78), 65(79) and 65(105)(zb) of the Finance Act, 1994 as ultra vires the Constitution of India.
(2.) Learned Senior Advocate for the petitioner has submitted that, the petitioner was awarded two contracts for preparation of Electoral Photo Identity Card (EPIC). The petitioner has suffered the impugned show-cause notice calling upon the petitioner to pay service tax as according to the department, the preparation of EPIC includes taking of photographs of voters by Digital Camera, processing, lamination and, therefore, such authority comes within the purview of photography service. According to the department the petitioner is liable to pay service charges.
(3.) Learned Senior Advocate for the petitioner has submitted that, the authorities in issuing the show-cause notice did not take into account the agreements subsisting between the Electoral Officers of West Bengal and Bihar. He has also referred to a letter dated January 22, 2007 issued by the Deputy Chief Electoral Officer where the rates were approved. He has submitted that, photography is one of the several activities which a person has to undertake in order to produce an EPIC. The differential rates mentioned in the letter dated January 22, 2007 of the State of West Bengal would establish that, the value of taking photograph is about of 5.5% of the price of the complete EPIC. The petitioner is not a photography studio or agency within the meaning of Sub-section (79) of Section 65. The petitioner does not come under the purview of Sub-Clause (3b) of Clause (105) of Section 65.;