Brilliant Corporate Services Private Limited, (Now known as M/s. Brivas Private Limited) Vs Commissioner (Madras High Court)
The petitioner, Brilliant Corporate Services Private Limited, challenged a show cause notice dated 23.10.2019 issued by the Commissioner of GST and Central Excise, Chennai Outer Commissionerate. The notice was issued to five entities, including the petitioner, based on common directorship and partnership among them. The petitioner argued that the notice violated the CBEC Master Circular No.1053/2/2017-CX dated 10.03.2017, which mandates a pre-consultation when the amount involved exceeds ₹50 lakhs. It was contended that the absence of such pre-consultation rendered the notice without jurisdiction. Reliance was placed on earlier decisions, including Tube Investment of India Ltd. v. Union of India (2018), Hitachi Power Europe GmbH v. CBI & C (2019), Amadeus India Pvt. Ltd. v. Principal Commissioner of Central Excise (2019), and Back Office IT Solutions Pvt. Ltd. v. Union of India (2021), where courts emphasized the necessity of pre-consultation before issuing show cause notices involving large amounts.
The High Court examined the petitioner’s contentions and noted that the show cause notice covered combined service tax demands totaling ₹27,08,05,519, including alleged short payments and wrong CENVAT credit availed by five entities. The Court observed that the circular cited by the petitioner was only intended to encourage voluntary compliance and reduce litigation, but it did not have statutory force under the Finance Act, 1994. Referring to the Supreme Court’s ruling in Commissioner of Central Excise v. Rattan Melting and Wire Industries (2008), the Court held that departmental circulars are not binding on courts.
