2013 (12) TMI 1065 - AT - Service Tax

Rejection of refund claim - Bar of limitation - Notification No. 41/2007 - Commissioner allowed refund claim - Held that - refund claim was filed by claiming benefit of exemption Notification No. 41/2007 and the period involved in the case is April, 2008 to June, 2008 and July, 2008 to Sept., 2008. For the period from April, 2008 - June, 2008, the period of two months was applicable is also not in dispute. The time limit prescribed under Section 11B would not apply since the case relates to benefit of notification and the conditions laid down in the Notification have to be fulfilled - The respondent claimed benefit of Notification, the same is required to be construed strictly and the refund claim filed beyond the period of two months from April to June, 2008 is hit by limitation of time prescribed in the Notification. So far as the period involved July, 2008 - Sept., 2008 is concerned, the time limit of six months would apply as the period is covered under the amendment to notification. refund was to be filed within two months of quarter ending and the time limit was to expire after the introduction of amendment Notification No. 32/2008-S.T., dated 18-11-2008. Therefore, the period shall be covered under the amendment provisions of prescribed time limit of six months. This is to be re-quantified in terms of the Notification No. 32/2008. Therefore, this case is remanded to the lower adjudicating authority for limited purpose of re-quantification of refund claim for the period from July, 2008 to Sept., 2008 - Decided in favour of Revenue.

Summary

Issues:
- Appeal against modification of lower adjudicating authority's order on refund claim time-barred under Notification No. 41/2007 as amended.
- Interpretation of time limits for filing refund claim under Notification No. 41/2007 and subsequent amendment to Notification No. 32/2008-S.T.
- Application of Section 11B for time limits in Service Tax refund claims.
- Strict construction of conditions under exemption Notification and reliance on relevant case laws for interpretation.

Analysis:
1. The appeal before the Appellate Tribunal concerned the modification of the lower adjudicating authority's order on a refund claim filed by the respondent, a merchant-exporter, for Service Tax paid on commission to their agent for taxable services utilized in exporting goods. The Commissioner (Appeals) rejected the refund claim as time-barred under Notification No. 41/2007 as amended, leading to the Revenue's appeal.

2. The Revenue contended that the time limit for filing the refund claim was two months under the original Notification, which was later extended to six months by an amendment. The argument was that for the relevant period, the two-month limit applied before the amendment date.

3. In response, the respondent's Counsel argued that the time limit prescribed under Section 11B should apply to Service Tax refund claims, and they had filed within one year, thus not time-barred. Citing a Tribunal decision, they emphasized the importance of timely filing and claimed compliance within the extended period.

4. The Tribunal carefully considered the submissions and records, noting that the case involved invoking an exemption under Notification No. 41/2007 for specific periods. It was clarified that the time limit under Section 11B did not apply in such cases, and strict adherence to the Notification's conditions was necessary, as established by relevant Supreme Court judgments.

5. Ultimately, the Tribunal found merit in the respondent's argument regarding the time limit for the period covered by the amendment to the Notification. The case was remanded to the lower authority for re-quantification of the refund claim for that specific period, aligning with the amended provisions.

6. The judgment highlighted the importance of clear compliance with Notification conditions for claiming exemptions and emphasized the need for strict interpretation in such cases. The decision to remand the case for re-quantification reflected a balanced approach to address the specific time limit issue under the amended Notification.

This detailed analysis encapsulates the key legal points and arguments presented in the judgment, focusing on the interpretation of time limits for filing refund claims under relevant Notifications and the application of legal principles to determine the outcome of the appeal.