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ORDINARY ORIGINAL CIVIL JURISDICTION
CENTRAL EXCISE APPEAL NO.192 OF 2019
AND
CENTRAL EXCISE APPEAL NO.193 OF 2019
AND
CENTRAL EXCISE APPEAL NO.194 OF 2019
CENTRAL EXCISE APPEAL NO.195 OF 2019
The Board of Control for Cricket in India (BCCI) .. Appellant
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Mr.Sriram Sridharan for Appellant.
Mr.Jitendra Mishra a/w Mr.Satyaprakash Sharma for Respondent.
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ORAL JUDGMENT
2. The appellant was issued show cause notices for the relevant periods being F.Y. 2007-08, F.Y. 2008-09, F.Y. 2010-11 and F.Y. 2011-12, classifying the assessee as a ‘Franchisee’ within the meaning of Section 65 (47) of Chapter V of the Finance Act, 1994 in relation to services rendered by it to MSM Satelite (Singapore) which were in respect of telecast of Indian Premier League (IPL) Cricket matches, being played on the Indian soil.
3. It is seen from the record that the issue before the Tribunal was in regard to the taxability of the said services, as the appellant had taken a specific plea in regard to the non-taxability of the said services, inter alia, contending that such services and subject matter of such agreements, as sought to be taxed, were transactions of “export of service,” falling within the purview of Export of Services Rules, 2005, including the applicability of an amendment as brought about to Rule 3 (1) of the said Rules by Export of Services (Amendment) Rules, 2010, with effect from 27th February 2010. The Tribunal in adjudicating the appellant’s appeal considered such issue, however, it did not find favour with the contentions as urged on behalf of the appellant that such services were not taxable. The Tribunal has held that the transaction was not a transaction of export of service.
4. In the above circumstances, the appellant is before us in these appeals for the periods as noted above.
5. We had taken up these appeals for hearing when Mr.Mishra on behalf of the respondent/revenue has raised a preliminary objection to the maintainability of these appeals before this Court, contending that the issue raised in these appeals, is in regard to determination of taxability of the services for the purpose of assessment. Referring to the provisions of Section 35H and 35L of the Central Excise Act, 1944, (for short the “1944 Act”) as made applicable to the service tax, Mr. Mishra would submit that on the issue on determination of taxability, the appeals would lie before the Supreme Court. He has also drawn our attention to a recent order passed by this Court in case of The Principal Commissioner of CGST and Central Excise, Mumbai East Commionerate Vs. ICICI. This Court, in such case, had considered an objection as raised on behalf of the respondent/assesses therein, on the maintainability of the Revenue’s appeal. The Court has noted the provisions of the 1944 Act, as extended to the Finance Act, 1994, in relation to levy of service tax. In such decision, this Court considering the decision of the Full Bench of this Court in case of Commissioner of Central Excise,Mumbai-V Commissionerate Vs. M/s. Reliance Media Works Ltd.[2] as also the decision of the co-ordinate Benches of this Court in case of Commissioner of Service Tax Vs. Surindra Engineering Co. Ltd.[3] and in The Commissioner of Service Tax, Mumbai-VII, Mumbai Vs. M/s.Phoenix International Freight Service Pvt. Ltd. 4 observed that on a cumulative reading of the provisions of Section 83 of the Finance Act, 1944 read with the provisions of Section 35G and 35L of the 1944 Act, it was clear that an appeal would lie to the Supreme Court from an order passed by the Appellate Tribunal, if the question which arises for determination is the one falling under the provisions of sub-section (2) of Section 35L would mandate.
6. The provisions of Section 35G and Section 35L of the 1944 Act which are made applicable to the Finance Act, 1994 in relation to the levy of Service Tax referring to which, such objection is raised on behalf of the Revenue are required to be noted which reads thus: - Section 35G. Appeal, to High Court.- (1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal on or after 1st Day of July 2003 (not being an order relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for the purposes of assessment) if the High Court is satisfied that the case involves a substantial question of law. (2) The Commissioner of Central Excise or the other party aggrieved by any order passed by the Appellate Tribunal may file an appeal to the High Court and such appeal under this sub-section shall be – (a) filed within one hundred and eighty days from the date on which the order appealed against is received by the Commissioner of Central Excise or the other party. (b) accompanied by a fee of two hundred rupees where such appeal is filed by the other party.
(c) in the form of a memorandum of appeal precisely stating therein the substantial question of law involved. [(2A) The High Court may admit an appeal after the expiry of the period of one hundred and eighty days referred to in clause (a) of subsection (2), if it is satisfied that there was sufficient cause for not filing the same within that period.] (3) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. (4) The appeal shall be heard only on the question so formulated, and the respondent shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question. Provided that nothing in this sub-section shall be deemed to take away abridge the power of Court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, it is satisfied that the case involves such question. (5) The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which decision is founded and may award such cost as it deems fit. (6) The High Court may determine any issue which – (a) has not been determined by the Appellate Tribunal, or (b) has been wrongly determined by the Appellate Tribunal, by reason of a decision of such question of law as is referred to in sub-section (1). (7) When an appeal has been filed before the High Court, it shall be heard by a bench of not less than two judges of the High Court, and shall be decided in accordance with the opinion of such judges or of the majority, if any, of such judges. (8) Where there is no such majority, the judges shall state the point of law upon which they differ and the case shall, then, be heard upon that point only by one or more of the other judges of High Court and such point shall be decided according to the opinion of the majority of the judges who have heard the cases including those who first heard it. (9) Save as otherwise provided in this Act, the provisions of code of Civil Procedure 1908, relating to the appeals of High Court shall as far as may be apply in cases of appeals under this section. Section 35L – Appeal to the Supreme Court (1) An appeal shall lie to the Supreme Court from a) any judgment of the High Court delivered -
(i) in an appeal made under section 35G; or
(ii) on a reference made under section 35G by the
(iii) on a reference made under section 35H, in any case which, on its own motion or on an oral application made by or on behalf of the party aggrieved, immediately after passing of the judgment, the High Court certifies to be a fit one for appeal to the Supreme Court; or b) any order passed before the establishment of the National Tax Tribunal by the Appellate Tribunal relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for purposes of assessment. (2) For the purposes of this Chapter, the determination of any question having a relation to the rate of duty shall include the determination of taxability or excisability of goods for the purpose of assessment.” (Emphasis supplied)
7. We may observe that sub-section (2) of Section 35L, itself clarifies that for the purpose of Chapter VI-A, the determination of any question having a relation to the rate of duty, shall include the determination of “taxability” or “excisability” of goods for the purpose of assessment.
8. A Full Bench of this Court in case of Commissioner of Central Excise, Mumbai-V Commissionerate Vs. M/s. Reliance Media Works Ltd. (supra) also dealt with such issue that the appeals which arises from the orders of the Tribunal which relate to taxability or excisability passed prior to 6 August, 2014, i.e., the date on which Section 35L(2) of the 1944 Act, came to be inserted, being an issue on rate of duty, would be appealable only before the Supreme Court and not before the High Court. The Full Bench also held that the amendment made to Section 35L of the Act was clarificatory in nature and, had a retrospective in operation. The relevant observations as made in paragraphs 10, 12,13 and 14 of the orders of this Court in the case of ICICI Bank Ltd. (supra) are required to be noted which read thus:- “10. On a cumulative reading of the provisions of Section 83 of the Finance Act, 1944 read with the provisions of Section 35G and 35L of the CE Act, we are of the clear opinion that necessarily the law itself provides that an appeal would lie to the Supreme Court from an order passed by the Appellate Tribunal. The question which arises for determination is one having a relation to the rate of duty of excise or to the value of goods for purposes of assessment.
12. Insofar as the decisions as cited on behalf of the respondent, we find that the reliance on the decision of the Full Bench of this Court in the case of The Commissioner of Central Excise, Mumbai vs. M/s. Reliance Media Works Ltd. (supra) is apposite. The following question had fell for consideration of the Full Bench as arisen from the orders as referred by the Division Bench: “a) Whether the question of taxability or excisability of goods is an issue of rate of duty arising from orders of the Tribunal which are appellable only to the Supreme Court in terms of Section 35L(2) of the Act, applies even to appeals from order of the Tribunal passed prior to 6 August, 2014, i.e., the date of insertion of sub-section (2) to Section 35L of the Act? b) Whether the amendment made to Section 35L of the Act on 6 August, 2014 by insertion of sub-section (2) therein, is clarificatory or prospective in nature”.
13. The Full Bench, considering the provisions of Section 35G and 35L and the law in such context, answered the issue in terms of what has been held in paragraph 9 of the said judgment, which reads thus:
14. Similar view was taken by this Court in the case of M/s. Surindra Engineering Co. Ltd. (supra) as also in the case of M/s. Phoenix International Freight Service Pvt. Ltd. (supra).”
9. As noted above, the case of the appellant is on the issue that services in question are not taxable as ‘Franchisee’, as the appellant is undertaking export of services. In other words, the issue is, as to whether in relation to services in question, any tax can at all be levied under the provisions in question, is the question which falls for determination. Thus necessarily the issue is in relation to the determination of taxability. Such issue can be considered and adjudicated only by the Supreme Court, as per the mandate of the provisions of Section 35L of the 1994 Act.
10. Even otherwise Section 35H of the 1944 Act which provides for an appeal to the High Court, clearly carves out an exception in regard to exclusion of matters not relating, amongst other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for purposes of assessment, which is now the legislative clarification as provided by an amendment as incorporated to Section 35L by insertion of sub-section (2), which is a clarification in relation to the entire Chapter in question namely Chapter VI-A dealing with the Appeals.
11. Mr. Shridharan, learned counsel on behalf of the appellant, however, has opposed the preliminary objection as raised by Mr.Mishra referring to decision of the Supreme Court in case of Commissioner of Central Excise, Hyderabad Vs. Shriram Refrigeration Industries[5]. On a reading of the said decision, it is seen that in the facts and circumstances of such case, the Supreme Court was of the opinion that the dispute in question has no relation to the value of the goods and/or the dispute with respect to the valuation. In such context, after referring to the decision in Commissioner of Customs, Bangalore-1 vs. Motorola India Limited[6] and in case of Asean Cableship Pte. Ltd. Vs. Commissioner of Customs[7] it was held that the appeal was maintainable before the High Court. The Supreme Court thus observed that in the facts of the case in hand, the dispute had no relation to the rate of duty or the value of the goods and/or the dispute with respect to the valuation, the appeals were maintainable before the High Court under Section 35G of the 1944 Act. The relevant observations in the facts of such case are required to be noted which read thus:-
12. Mr. Mishra, learned counsel on behalf of the revenue has also drawn our attention to an order passed by the Supreme Court in case of Infosys Vs. Commissioner[8] wherein the Supreme Court had admitted an appeal on the “issue of taxability” as involved in the said appeals, the observation of the Supreme Court in the order dated 5th July 2021 passed in such case reads thus:- “3. The companion appeals have been filed by the respondent (infosys Limited) to the first of the two appeals listed before us. Two Central Excise Appeals were filed before the High Court, Central Excise Appeal No.45 of 2014 by the Infosys Limited and Central Excise Appeal No.47 of 2014 by the Commissioner of Service Tax. Among the issues raised in the appeals were issues pertaining to the liability to CENVAT as well as taxibility. The High Court by its order dated 27th February 2020, declined to entertain the appeals noting that in view of the issue of taxibility, the appeals would have to be filed before this Court.” (Emphasis supplied) 8 2015 (37) STR 862
13. In the light of the above discussion, in our view, the present appeals raise an issue on the taxability of the services in question, hence these appeals are not maintainable before this Court. The remedy of the appellant would be to approach the Supreme Court by filing an appeal under Section 35 of the 1994 Act. We, accordingly, dispose of the above appeals permitting the appellant to present these appeals before the Supreme Court. All contentions on the appeals are expressly kept open. No costs.
JITENDRA JAIN, J. G. S. KULKARNI, J.