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P. C. Joshi vs. UOI (Bombay High Court)

COURT:
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DATE: December 15, 2014 (Date of pronouncement)
DATE: December 17, 2014 (Date of publication)
AY: -
FILE: Click here to download the file in pdf format
CITATION:
Article 19(1)(g): Levy of service-tax on Advocates is constitutional

A Writ Petition was filed to challenge the levy of service-tax on advocates. It was claimed that an advocate renders services which cannot be said to be commercial or business like. They cannot be equated with the service providers mentioned in the Finance Act 1994. It was also contended that advocacy is not a business but a profession and a noble one. An advocate is a part and parcel of the administration of justice and which is a sovereign or regal function and hence providing for a Service Tax on advocates would mean that their services will no longer be available or accessible to those seeking justice from a Court of law. That would defeat the constitutional guarantee of free, fair and impartial justice. HELD by the High Court dismissing the Petition:

(i) The legislature has neither interfered with the role and function of an advocate nor has it made any inroad and interference in the constitutional guarantee of justice to all. The services provided to a individual client by a individual advocate continues to be exempted from the purview of the Finance Act and consequently Service Tax but when an individual advocate provides service or agrees to provide services to any business entity located in the taxable territory, then, he is included and liable to pay Service Tax. The classification between those who can afford professional legal services and are ready to pay the fees or charges demanded without seeking any reduction or concession and those who cannot pay legal fees but can at best bear meagre expenses has been made. This classification has a reasonable nexus with the object sought to be achieved.

(ii) The economic realities are that even, legal services are rendered in an organized manner. When advocates group or organize themselves by making huge investments in acquiring immovable properties for professional work, heavy overheads, in the form of clerical and support staff, with facilities of cabins or rooms, then, legal services are rendered to organized groups or business entities predominantly. These persons can very well pay the fees and charges without any demur or complaint;

(iii) What holds good for chartered accountants and architects must equally apply to other professionals such as advocates, and who too are well conscious of their status.

10 comments on “P. C. Joshi vs. UOI (Bombay High Court)
  1. A.K.JOSHI says:

    Land mark judgement

  2. CA Anant Pai says:

    ” What holds good for chartered accountants also hold good for advocates”- said the HC. Nobody can be more pleased to hear this than me”

  3. Amit sharma says:

    Sir,i want to know the different sort of guidelines which is required in the matter of Appeal before ITAT.
    Thanks

  4. Problem is if advocates allocates 10% of time to give free advice and fight some cases freely without fee he is totally exempted under Advocates Act, if advocate does not give his 10% time how he can be doing service to the people free of cost , but here when big solicitors and rich advocates never ever give free legal service when so their services are falling under commercial activities, so the judgement here is valid….if joshi could show he renders 10 % of his advocacy time then he can move for curative petition before same bench which would consider favorably,

    incidentally, under central excise Act advocates are exempted and yet subject to court rulings too against such irrational dispensations by finance ministry .

    see if arun apears as an advocate he would seek exemption though he may not give any free legal advice, like P.chidambaram too!

    Administration when is unreasonable under wednesbury principle or theory of proportionality judiciary can rightly interfere and dispense justice,

    Legal services committe since it pays the advocates those advocates too cannot excape the service tax unless in their own volition render free legal service per advocates Act thought then naturally exemption is possible.

    see under BPL even rich farmers get all government benefits, which Modi government rightly wants tp remove as these rich farmers take away poor farmers benefits like LPG gas subsidy.

    there are many poor lawyers not even earn just 50,000 per year, but have to look after a family of 4 or more adults but are they given any LPG subsidy and others, since they are like poor farmers status too, that way many CAs are too in real BPL category as coerie in the profession just corner benefits… why many degree or diploma engineers are really falliing in BPL category but are they looked after.

    so that way i find rich advocates just take service tax component from clients like businessmen do and a loty of times they gulp that service tax money too;

    No professional really pays like any commercial enterprise pay service taxes but they take that component from customers under many innovative modes like in the medical profession..so every activity in business proportions really in fact pay from their pockets but poor customers are really multiply taxed, that way service tax Act itself is very seriously faulty but no one moves PILs or Writs explaining the problems of people who under Art 19(1) as also under Art 21 can move at the Apex court that Art 265 is misused by the governments in place, after all Art 265 is clear procedure prescribed by law mean the very constitution of india but government says it is their statute , such clever governmental administrative functions today against the very interests of the citizens please.

    please people need to fight for their individual fundamental rights is my view if not you can be taken for granted by Executive and administrators sir!

  5. Problem is if advocates allocates 10% of time to give free advice and fight some cases freely without fee he is totally exempted under Advocates Act, if advocate does not give his 10% time how he can be doing service to the people free of cost , but here when big solicitors and rich advocates never ever give free legal service when so their services are falling under commercial activities, so the judgement here is valid….if joshi could show he renders 10 % of his advocacy time then he can move for curative petition before same bench which would consider favorably,

    incidentally, under central excise Act advocates are exempted and yet subject to court rulings too against such irrational dispensations by finance ministry .

    see if arun apears as an advocate he would seek exemption though he may not give any free legal advice, like P.chidambaram too!

    Administration when is unreasonable under wednesbury principle or theory of proportionality judiciary can rightly interfere and dispense justice,

    Legal services committe since it pays the advocates those advocates too cannot excape the service tax unless in their own volition render free legal service per advocates Act thought then naturally exemption is possible.

    see under BPL even rich farmers get all government benefits, which Modi government rightly wants tp remove as these rich farmers take away poor farmers benefits like LPG gas subsidy.

    there are many poor lawyers not even earn just 50,000 per year, but have to look after a family of 4 or more adults but are they given any LPG subsidy and others, since they are like poor farmers status too, that way many CAs are too in real BPL category as coerie in the profession just corner benefits… why many degree or diploma engineers are really falliing in BPL category but are they looked after.

    so that way i find rich advocates just take service tax component from clients like businessmen do and a loty of times they gulp that service tax money too;

    No professional really pays like any commercial enterprise pay service taxes but they take that component from customers under many innovative modes like in the medical profession..so every activity in business proportions really in fact pay from their pockets but poor customers are really multiply taxed, that way service tax Act itself is very seriously faulty but no one moves PILs or Writs explaining the problems of people who under Art 19(1) as also under Art 21 can move at the Apex court that Art 265 is misused by the governments in place, after all Art 265 is clear procedure prescribed by law mean the very constitution of india but government says it is their statute , such clever governmental administrative functions today against the very interests of the citizens please.

    please people need to fight for their individual fundamental rights is my view if not you can be taken for granted by Executive and administrators sir!

  6. dear Amit sharmaji,
    one should resist the tribunal when it interprets law, it just has to only examine all facts of law and facts and nothing more than that, else it is a ruse it plays in the hands of Revenue,

    see they have constitution benches a farce indeed, a constutional bench it has no power to constitute a constitutional bench,

    further by constitutional bench there should at least 3 judicial members only and not account member but it has one Account member and and judicial member, even SC under Ar 145(2) constitute 5 member benches and in spl circumstance 3 member bench while members are judicial members not one is a civil servant in such benches such benches are called constitutional benches which allows experts sometimes give their ipinions before such benches… when you see the position of SC constititutionsal benches don’t you find some farcity or farce in tribunal constituted consatitutional benches, if allowed soon this cancer might also enter in central administrtive tribunals too , that clearly show how Executive play tricks on judiciary, as indian judiciary is weak unlike UK judiciary or US judiciary, though indian constitution is a great cocktail of the best constitution, so i plead constitutional courts need to review the laws and rules of thesae cancerous formations machinated by indian Executive, after all indian judiciary is indeed a great bajrangbali ! it has to assert after all coterie in Executive would do its best to torpedo the citizens power to question the government, after all truth is you have 3 wings ofd fovernment to balance the excesses perpetrated.. indeed judiciary is the custodian of the indian constitution that every rue citizen needs to know if not he just pkedges to whims of the Executive!

  7. dear Amit sharmaji,
    one should resist the tribunal when it interprets law, it just has to only examine all facts of law and facts and nothing more than that, else it is a ruse it plays in the hands of Revenue,

    see they have constitution benches a farce indeed, a constutional bench it has no power to constitute a constitutional bench,

    further by constitutional bench there should at least 3 judicial members only and not account member but it has one Account member and and judicial member, even SC under Ar 145(2) constitute 5 member benches and in spl circumstance 3 member bench while members are judicial members not one is a civil servant in such benches such benches are called constitutional benches which allows experts sometimes give their ipinions before such benches… when you see the position of SC constititutionsal benches don’t you find some farcity or farce in tribunal constituted consatitutional benches, if allowed soon this cancer might also enter in central administrtive tribunals too , that clearly show how Executive play tricks on judiciary, as indian judiciary is weak unlike UK judiciary or US judiciary, though indian constitution is a great cocktail of the best constitution, so i plead constitutional courts need to review the laws and rules of thesae cancerous formations machinated by indian Executive, after all indian judiciary is indeed a great bajrangbali ! it has to assert after all coterie in Executive would do its best to torpedo the citizens power to question the government, after all truth is you have 3 wings ofd fovernment to balance the excesses perpetrated.. indeed judiciary is the custodian of the indian constitution that every rue citizen needs to know if not he just pkedges to whims of the Executive!

  8. IN FACT ADVOCACY NEED BE AFFORDABLE TO ANY ONE,SO IT S OBVIOUS THE ADVOCATE NEED BE GIVEN FROM ALL DIRECT TAXES THAT WAY LITIGATION COSTS WOULD COME DOWN,SO WE NEED TO TREAT ADVOCACY IS NEEDED TO PROTECT CITIZENS’ RIGHTS AT ALL TIMES.

    TODAY EVERY EXECUTIVE GOVT FAILS TO UNDERSTAND THEIR OWN SIMPLE REGULATIONS, HOW A CITIZEN CAN FEND HIMSELF WITHOUT PROFESSIONAL ADVOCACY.

    IF AFFORDABLE ADVOCACY IS NOT PROVIDED BY ANY EXECUTIVE GOVT THAT OBVIOUSLY MEAN CORRUPTION IS EXTREMELY USED EVERY WHERE SO THERE IS OBVIOUS FAILURE OF GOVERNANCE

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