2015 (5) TMI 776 - AT - Service Tax

Denial of refund claim - Unjust enrichment - documents had not been produced to show that the amount charged to the foreign network operator was as per agreement and also to show that no service tax was charged - Held that - principle of unjust enrichment would not be applicable to export transactions as specifically provided in section 11B of Central Excise Act, 1944. The facts of the case of Vodafone Cellular Ltd. (2014 (3) TMI 117 - CESTAT MUMBAI) are similar to the facts of the present case. However, we further note that the adjudicating authority and the Commissioner (Appeals) have come to the conclusion that the appellant could not satisfy the lower authority that the amount of service tax paid by them is correlated with the invoices raised on foreign mobile operator for inbound international roaming charges. The appellant, on the other hand, claim that the information has been provided and even chartered accountants certificate has been submitted to the effect that the service tax of ₹ 15,64,222/- has been paid in connection with inbound international roaming service and that the service tax was not shown in the invoices nor collected from the customers. Matter remanded back - Decided in favour of assessee.

Summary

Issues:
Claim of refund for service tax paid on international roaming services.

Analysis:
The appellant filed a refund claim for service tax paid on services provided to a foreign network operator for international roaming facility. The Commissioner rejected the claim due to lack of documents showing the amount charged and the absence of proof that no service tax was charged. The adjudicating authority also highlighted the failure to provide details of service tax payment on services provided to international inbound roamers and to identify the amount in the invoices. The appellant argued that the burden of proof regarding unjust enrichment was on them, but the rejection was based on the lack of specific details rather than unjust enrichment.

The Tribunal referred to a similar case where the principle of unjust enrichment was not applicable to export transactions. Despite this, the lower authorities concluded that the appellant failed to demonstrate the correlation between the service tax paid and the invoices raised on the foreign mobile operator for inbound international roaming charges. The appellant claimed to have provided information and a chartered accountant's certificate confirming the payment of service tax, not reflected in the invoices or passed on to customers. The lack of communication hindered the verification of the certificate's authenticity from the appellant's records. The Tribunal noted that the rejection based on unjust enrichment was not entirely accurate, as the documents did not explicitly address the issue of passing on the service tax burden.

Consequently, the Tribunal held that the principle of unjust enrichment did not apply due to the exemption for export of service. The case was remanded to the adjudicating authority for determining the quantum of service tax refund to be sanctioned. The appellant was instructed to provide all necessary details and cooperate for the verification process. The appeal was allowed by way of remand for further proceedings.