2015 (5) TMI 109 - AT - Service Tax

Denial of refund claim - Bar of limitation - some invoices do not contain requisite details as prescribed in rule 4A of Service Tax Rules, 1994 - No evidence of payment made against the invoices on which refund is sought - Held that - adjudicating authority has taken the new ground to adjudicate the refund at the time of verification of certain documents which is also not permissible in law. As the show cause notice was issued to the appellant in the matter has already attained finality by the order of the Commissioner (Appeals) on 02.09.2011. If at all, the adjudicating authority wanted to re-examine all the refund claims, the adjudicating authority is required to be issue fresh show cause notice which the adjudicating authority has failed to do so. In the circumstances, the order dated 02.09.2011 has attained finality as held by the Apex Court in the case of ITC Ltd. 2006 (9) TMI 34 - SUPREME COURT OF INDIA , Revenue has not preferred any appeal against that order. In the circumstances, the adjudicating authority has no right to re-examine the refund claim but only can verify the documents as directed by the Commissioner (Appeals). In the Notification No.41/2007, there is no condition that if the services availed prior to the date of notification, the appellant are not entitled to refund claim as held by the Hon ble Bombay Court in the case of WNS Global Service Pvt.Ltd. (2008 (1) TMI 94 - CESTAT, MUMBAI). - Impugned order is set aside - Decided in favour of assessee.

Summary

Issues:
1. Finality of Order-in-Appeal No.222/ST/DLH/2011
2. Right of adjudicating authority to re-examine refund claim on new ground
3. Entitlement to refund claim for services availed prior to amendment in notified services

Analysis:

(i) Finality of Order-in-Appeal No.222/ST/DLH/2011:
The Commissioner (Appeals) passed an order on 2.9.2011 directing verification of certain documents. The appellant argued that this order had attained finality as the department accepted it. The Tribunal held that while the documents could be examined, the refund claim itself could not be re-examined without fresh show cause notice. The Tribunal emphasized that the order had attained finality, and the adjudicating authority had no right to re-examine the refund claim without issuing a fresh show cause notice.

(ii) Right of adjudicating authority to re-examine refund claim on new ground:
The adjudicating authority raised new grounds during document verification, which was deemed impermissible as the show cause notice had already attained finality through the Commissioner (Appeals) order. The Tribunal ruled that the adjudicating authority could only verify documents as directed by the Commissioner (Appeals) and could not introduce new grounds for rejection without issuing a fresh show cause notice.

(iii) Entitlement to refund claim for services availed prior to amendment in notified services:
Regarding the entitlement to refund claim for services availed before the amendment in notified services, the Tribunal held that the conditions in Notification No.41/2007 did not preclude refunds for services availed before the notification date. Citing relevant case law, the Tribunal rejected the argument that services availed before the notification amendment rendered refund claims inadmissible. The Tribunal directed the adjudicating authority to sanction the refund claim upon verifying the documents as per the Commissioner (Appeals) order.

In conclusion, the Tribunal set aside the impugned order and instructed the adjudicating authority to process the refund claim within 90 days based on the documents directed by the Commissioner (Appeals), emphasizing that new grounds for rejection could not be introduced without a fresh show cause notice.