Larsen & Toubro Ltd. Vs Union of India (Bombay High Court)
Bombay High Court held that show cause notice based on allegation that scheme approved by the Court is in contravention of provisions of the Finance Act quashed as order sanctioning the scheme has not been challenged by any authority and has attained finality.
Facts- By this petition under Article 226 of the Constitution of India, Petitioner seeks to challenge a show cause notice No.127 of 2018 dated 23rd October 2018 issued to Petitioner-L & T Hydrocarbon Engineering Limited (“LTHE”), for the period 2013-14 to show cause why service tax demand should not be raised under the Finance Act, 1994.
The foundation of the impugned show cause notice is that the High Court has approved the scheme of arrangement on the basis that there is no contravention of any provisions of the law, whereas the scheme of arrangement has resulted into various contraventions of the provisions of the Finance Act, 1994 being service tax provision.
Conclusion- Held it is clear that the whole basis of issuing show cause notice is that High Court has approved the scheme of arrangement without considering that the scheme is in contravention to the provisions of the Finance Act, 1954 and the Rules made thereunder. In our view, if Respondents were aggrieved by order dated 20th December 2013 approving the scheme of arrangement then they ought to have challenged the same. However, it is undisputed that the order sanctioning the scheme has not been challenged by any authority and has attained finality. Therefore on this basis itself the show cause notice falls to ground.
