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2025 Supreme(Kar) 2429
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
S.R.KRISHNA KUMAR, J.
Mangalore Steamer Agents Association, Through Its Authorized Signatory, Mr. Praveen Kumar Bangera – Appellant
Versus
Union Of India, Through The Secretary – Respondent
Writ Petition No. 32835 Of 2017 (T-RES)
Decided On : 28-11-2025
Important Points
Subject
Taxation - Service Tax
Headnote
Facts of the case:
Petitioners, representing steamer agents and importers, sought a declaration that specific sections and notifications under the Finance Act were unconstitutional and beyond legislative competence, citing they were never the service recipients liable for tax. (Para 1)
Findings of Court:
The court aligned with findings from the Madras High Court, declaring that service tax could not be demanded from the petitioners, as they, being neither steamer agents nor importers, do not receive services. The notifications challenged were found to have significant defects. (Paras 130-143)
Issues: The core question examined is whether the petitioners could be classified as recipients of service liable for service tax. (Paras 1, 160)
Ratio Decidendi: The court ruled that the responsibility to pay service tax cannot be shifted unfairly to third parties like the petitioners, especially when they do not receive services, affirming the principle of clear statutory frameworks and guidelines for tax liabilities. (Paras 68-110)
Result: Writ petitions are allowed, and the challenges against several notifications are dismissed. The show cause notices stand quashed.
For the Appellant : Sri. Bharat B. Raichandai, Adv. For Sri. Asim Malik, Adv.
For the Respondent: Sri. Jeevan J. Neeralagi, Adv.
ORDER :
S. R. KRISHNA KUMAR, J.
1. In this petition, petitioner seeks the following reliefs:
" a. Issue any writ, order or direction more particularly in the nature of a Writ of Declaration to declare Section 66C (2) of Chapter V of the Finance Act, 1994 (as amended) as null, void and ultra vires Article 14, 19, 246, 248, 265, 268A and 302 read with Entry 41 and 83 of List I of VII Schedule of the Constitution of India and as also being beyond the legislative competence of Parliament under Articles 246 and 248 of the Constitution of India and pass such further or other orders as this Hon'ble Court may deem fit and necessary in the facts and circumstance of the case and thus render justice;
b. Issue any writ, order or direction more particularly in the nature of a Writ of Declaration to declare Rule 10 of Notification No. 28 of 2012-ST dated 20.06.2012, (The Place of Provisions of Service Rules, 2012), as null, void and ultra vires Article 14, 19, 246, 248, 265, 268A and 302 read with Entry 41 and 83 of List 1 of VII Schedule of the Constitution of India and as also being beyond the legislative competence of Parliament under Articles 246 and 248 of the Constitution of India and pass such further or other orders as this Hon'ble Court may deem fit and necessary in the facts and circumstance of the case and thus render justice.
c. Issue any writ, order or direction more particularly in the nature of a Writ of Declaration to declare Notification No. 1 of 2017 dated 12.01.2017 vide F. No. 354/42/2016-TRU issued by the 1" Respondent, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-Section (1), as per Annexure - A, as ultra vires Article 14, 19, 265, 268A and 302 read with Entry 41 and 83 of List 1 of VII Schedule of the Constitution of India and pass such further or other orders as this Hon'ble Court may deem fit and necessary in the facts and circumstance of the case and thus render justice;
d. Issue any writ, order or direction more particularly in the nature of a Writ of Declaration to declare Notification No. 2 of 2017 dated 12.01.2017 vide F No. 354/42/2016-TRU issued by the 1 Respondent, published in the Gazette of India, Extraordinary, Part II, Section 3. Sub-Section (i), as per Annexure - A as ultra vires Article 14, 19, 265, 268A and 302 read with Entry 41 and 83 of List 1 of VII Schedule of the Constitution of India and contrary to Section 14 of the Customs Act, 1962 read with the provisions of Rule 10(2) of the Customs Valuation (Determination of Price of Imported Goods) Rules, 2007 and pass such further or other orders as this Hon'ble Court may deem fit and necessary in the facts and circumstance of the case and thus render justice;
e Issue any writ, order or direction more particularly in the nature of a Writ of Declaration to declare Notification No. 3 of 2017 dated 12.01.2017 vide F. No. 354/42/2016-TRU issued by the 1st Respondent, published in the Gazette of India, Extraordinary, Part II, Section 3. Sub-Section (i), as per Annexure A2 as ultra Vires Article 14, 19, 265, 2684 and 302 read with Entry 41 and 83 of List I of VII Schedule of the Constitution of India and contrary to Section 14 of the Customs Act. 1962 read with the provisions of Rule 10(2) of the Customs Valuation (Determination of Price of Imported Goods) Rules, 2007 and pass such further or other orders as this Hon'ble Court may deem fit and necessary in the facts and circumstance of the case and thus render justice;
f. Issue any writ, order or direction more particularly in the nature of a Writ of Declaration to declare Notification No. 15/2017-Service Tax dated 13.04.2017 issued by the 1st Respondent, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-Section (i), as per Annexure A3, as applicable on and from 22nd January, 2017 and pass such further or other orders as this Hon'ble Court may deem fit and necessary in the facts and circumstance of the case and thus render justice;
g. Issue a Writ of Certiorari or
