2017 (2) TMI 1275 - AT - Service Tax

Refund claim - finalisation of price - rejection of refund on the ground of time bar and unjust enrichment - Held that - the appellant is engaged in the manufacture of fertilizer which is exempted from the duty. The appellant paid the service tax to the GAIL who authorised the appellant to receive the refund. Hence, no element of unjust enrichment. Time limitation - Held that - the identical issue has came up before the Tribunal in the case of Chambal Fertilizers and Chemical Ltd. vs. CCE, Indore 2017 (1) TMI 549 - CESTAT NEW DELHI , where it was held that The applicability of Section 11B ibid for claiming refund of Central Excise duty/Service Tax is not restricted only to manufacturer/service provider. The said statutory provision mandate that any person can claim refund, subject to the conditions that the tax/duty was collected from or paid by him; and the incidence of such tax/duty had not been passed on by him to any other person - matter remanded to the adjudicating authority for denovo adjudication in the light of the above observations but by providing a reasonable opportunity to the assessee to present their case with liberty to file additional evidence, if necessary, as per law. Appeal allowed by way of remand.

Summary

Issues:
1. Refund claim rejection on grounds of being time-barred and unjust enrichment.
2. Applicability of exemption for fertilizer manufacturers.
3. Interpretation of relevant date for refund eligibility.
4. Tribunal's decision on remanding the matter for denovo adjudication.

Analysis:
1. The appellant, engaged in urea manufacturing, filed a refund claim against service tax paid to Gas Authority of India (GAIL) at provisional prices. The claim was rejected as time-barred and for unjust enrichment. The Tribunal noted that GAIL authorized the appellant to receive the refund, indicating no unjust enrichment.

2. The Tribunal found the appellant, a fertilizer manufacturer, exempt from duty. The issue mirrored a previous case involving Chambal Fertilizers and Chemical Ltd., where the Tribunal ruled in favor of refund eligibility due to provisional pricing adjustments by GAIL and the relevant date for refund claim filing.

3. Citing the Chambal case, the Tribunal emphasized the importance of the date when provisional prices were finalized through credit notes by GAIL. This date was crucial in determining the refund claim's timeliness, as per Section 11B. The Tribunal directed the jurisdictional Assistant Commissioner to verify the claim accordingly.

4. Based on the Chambal precedent, the Tribunal set aside the initial order and remanded the matter for denovo adjudication. The appellant was granted the opportunity to present their case with the liberty to submit additional evidence if needed. The appeal was allowed through remand, and cross-objection was disposed of accordingly.

This detailed analysis of the judgment provides insights into the issues raised, the Tribunal's reasoning, and the ultimate decision to remand the case for further adjudication based on legal grounds and precedents.