2014 (1) TMI 260 - AT - Service Tax

Demand of service tax - Denial of refund claim - Notification No.41/07-ST dated 6.10.2007 - Notification No.17/2009-ST - Notice not issued - Held that - assessee did not receive any notice of personal hearing at the adjudication stage the appellate authority was required to set aside the adjudication order on that singular ground and remand the matter for de novo adjudication from the stage of issuing a fresh notice for personal hearing. The appellate authority has adverted to this grievance of the assessee but failed to deal with it. The adjudicating authority rejected the refund claim on the ground that neither was the claim for refund presented in Form A - 1 as required by Notification No.17/2009-ST nor the relevant documents in particular as mandated by the Notification were furnished. The appellate authority does not deal with this finding of the adjudication order except stating that requisite documents of the details of export invoices of transporter etc. are on record - The matter is remanded to the appellate authority for de novo appellate disposal - Decided in favour of Revenue.

Issues:
1. Refund claim filed under incorrect notification.
2. Rejection of refund claim by the Assistant Commissioner of Service Tax.
3. Appeal against rejection of refund claim.
4. Observations and directions of the appellate authority.
5. Failure to receive notice of personal hearing.
6. Requirement of substantial compliance with Notification No.17/2009-ST for refund.

Issue 1: Refund claim filed under incorrect notification
The assessee filed a refund claim under Notification No.41/07-ST but was required to file under Notification No.17/2009-ST. The Revenue noticed this discrepancy and requested the correct application. The assessee submitted a revised application under the correct notification, but it was deemed inadequate by the Revenue, leading to a rejection of the claim by the Assistant Commissioner of Service Tax.

Issue 2: Rejection of refund claim by the Assistant Commissioner of Service Tax
The Assistant Commissioner rejected the refund claim citing non-compliance with Notification No.17/2009-ST requirements. The rejection was based on the claim not being presented in Form A-1 and the lack of relevant documents as mandated by the notification. The Assistant Commissioner's decision was challenged by the appellant through an appeal.

Issue 3: Appeal against rejection of refund claim
The appellant appealed the rejection, arguing that the claim was not rejected in compliance with the stipulations of the notification. The appellate authority found that the revised refund application provided all relevant information and supporting documents. It concluded that the rejection lacked substantive objections and set aside the adjudication order, remitting the matter for reconsideration.

Issue 4: Observations and directions of the appellate authority
The appellate authority set aside the adjudication order and directed the primary authority to verify the relevant documents for sanctioning the refund claim. It noted the failure to address the non-receipt of the notice of personal hearing and emphasized the need for substantial compliance with the notification requirements for granting the refund.

Issue 5: Failure to receive notice of personal hearing
The failure to receive a notice of personal hearing was highlighted as a crucial issue. The appellate authority should have set aside the adjudication order on this ground and remanded the matter for fresh adjudication starting with issuing a new notice for personal hearing.

Issue 6: Requirement of substantial compliance with Notification No.17/2009-ST for refund
The judgment emphasized the importance of substantial compliance with Notification No.17/2009-ST for refund claims. The appellate authority directed a thorough verification of the revised application and supporting documents to determine the eligibility for refund, stressing the need for adherence to the notification's requirements.

In conclusion, the Commissioner (Appeals) order was set aside, and the matter was remitted to the appellate authority for further consideration in accordance with the directions provided, focusing on the receipt of notices of personal hearing and substantial compliance with the notification for refund eligibility.

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