2011 (3) TMI 804 - AT - Service Tax

Refund - Since Service tax was paid twice for the same service - Section 11B of Central Excise Act, 1944 is made applicable for the purpose of claiming refund under service tax also - Any person is authorised to claim the refund, if the applicant is able to furnish documents to establish that the amount of duty in relation to which such refund is claimed was collected from or paid by him and such incidence of duty has not been passed on by him to any other person - The other objection is that the service tax code indicated is not that of M/s. Okay Transport Corporation but that of M/s. Veebros Freight Carriers - This does not alter the situation because at any rate the duty has been paid by the Respondent. - Refund claim allowed.

Issues:
1. Liability to pay service tax on Goods Transport Agency services.
2. Refund claim due to double payment of service tax.
3. Correctness of refund claim rejection based on TR-6 challan details.
4. Interpretation of Section 11B of the Central Excise Act for refund claims.

Analysis:
1. The case involves the liability to pay service tax on Goods Transport Agency services under Rule 2(1)(d)(v) of the Service Tax Rules, 1994. The Respondents, engaged in manufacturing footwear, availed services from a transport agency and paid service tax. The responsibility to pay service tax shifted to the recipient of the service, the Respondent, who had obtained service tax registration.

2. The Respondent mistakenly paid service tax twice for the same service provided by M/s. Okay Transport Corporation. Initially, they paid Rs. 1,14,091/- on 28-3-2007, mentioning the transporter's name on the TR-6 challan. Upon realizing the error, they paid Rs. 1,32,985/- on 15-5-2007, correctly mentioning their name and registration number. Subsequently, they filed a refund claim for the first payment, supported by a disclaimer certificate from the transport agency.

3. The Assistant Commissioner rejected the refund claim citing the incorrect name on the TR-6 challan and a mismatch in the service tax registration number. However, the Commissioner (Appeals) allowed the refund, considering both payments made by the Respondent for the same service due to a genuine mistake. The department appealed this decision, arguing that the refund should go to the transport agency, not the Respondent.

4. The judgment analyzed the applicability of Section 11B of the Central Excise Act for claiming refunds under service tax. It emphasized that the person paying the tax need not be the one claiming the refund. The key factor is proving that the duty amount was paid by the applicant and not passed on to another party. In this case, the duty was indeed paid by the Respondent, supported by the disclaimer certificate. The mismatch in service tax code was deemed irrelevant since the duty payment origin remained unchanged. Consequently, the appeal by the Revenue was dismissed, affirming the Respondent's eligibility for the refund.

Conclusion:
The judgment upheld the Respondent's refund claim for double payment of service tax, emphasizing the duty payment by the Respondent and the non-passage of the duty incidence to another party. The decision clarified the refund eligibility criteria under Section 11B of the Central Excise Act, highlighting the importance of actual duty payment rather than the entity mentioned in the payment documents.

← Previous Next →