2013 (4) TMI 551 - AT - Service Tax

Refund - Authorized Service Station - appellant were considered as direct Selling Agent by the dept. - Tribunal allowed the appeal after which the appellant had preferred the present refund claim - refund claim was rejected by the adjudicating authority on the ground of unjust enrichment - Held that - Since the appellant had contested the issue after the deposit of the amount by him on being directed by the investigating authorities, it cannot be said that the appellant had not disputed the amount. It is a settled law that once an assessee files an appeal against any amount which has been deposited by him or confirmed against him, he has raised a dispute. In this case the judgment of Jayant Glass Inds. (P) Ltd. (2003 (5) TMI 81 - CEGAT, NEW DELHI) and Parle International Ltd. 2000 (2) TMI 112 - HIGH COURT OF GUJARAT AT AHMEDABAD will squarely apply. Appeal of the assessee allowed and direction to the lower authorities to grant the refund of the amount to the appellant.

Summary

Issues: Refund claim rejection on grounds of unjust enrichment.

Analysis:
The appeal was against an order-in-appeal related to service tax registration. The appellant was considered a Direct Selling Agent and had paid service tax and interest during an inquiry. The show cause notice confirmed this, leading to an appeal before the Commissioner (A) who upheld the demand. The Tribunal then set aside the Commissioner's order, allowing the appeal with consequential relief, leading to the present refund claim.

The refund claim was rejected due to unjust enrichment. The appellant's appeal before the first appellate authority was also unsuccessful. The appellant argued that the Tribunal's previous order allowed their appeal with consequential relief, citing relevant legal precedents like the Jayant Glass Inds. case and the Parle International Ltd. judgment from the High Court of Gujarat.

The Assistant Commissioner contended that the appellant failed to prove that the service tax liability was not passed on to avail the refund. However, the Tribunal found that the appellant had deposited the refund amount during the investigation and contested the issue in higher judicial forums. It was established that once an assessee disputes an amount deposited or confirmed against them, a dispute is raised. Citing legal precedents, the Tribunal held that the impugned order was incorrect and set it aside, directing lower authorities to grant the refund to the appellant.