2015 (10) TMI 1933 - AT - Service Tax

Refund claim - service tax on GTA service was paid without availing of the exemption Notification No.32/04-ST dt.03.12.2004 - unjust enrichment - Held that - Refund was originally allowed by the adjudicating authority and on an appeal filed by the Revenue, Commissioner (Appeals) reversed the said order on two grounds. First on the ground of time bar, the refund applicant stand filed on 31.1.07 for the period January, 2005 to November, 2006. Admittedly the service tax in question was not paid by the appellant under protest, neither the assessments were provisional, in which case the limitation would apply. Inasmuch the refund stand filed after the normal period of limitation of one year, and only a part amount would fall within the limitation period, I hold that the refund amount beyond the period of limitation is not admissible to the appellants on the said ground - Service Tax was paid by the appellant on the GTA service so received by them, on reverse charge basis. Normally it is the service provider, who has to pay the Service Tax. As a recipient of the services, when it is the obligation of the appellant to discharge the service tax, the question of recovering the same from the service provider does not arise. As such, I hold that appellant succeed on the issue of unjust enrichment. - Matter remanded back - Decided in favour of assessee.

Summary

Issues:
1. Whether the appellant is entitled to a refund of service tax paid on goods transport services.
2. Whether the refund claim is time-barred under section 11B.
3. Whether the principle of unjust enrichment applies in this case.

Analysis:
1. The appellant paid service tax on goods transport services without availing the exemption Notification No.32/04-ST. A refund claim was filed for an amount of Rs. 62,635/-, which was sanctioned by the Assistant Commissioner but reversed by the Commissioner (Appeals) citing time-bar and unjust enrichment. The appellant argued against the reversal, stating that they are the recipients of the service and did not recover the service tax from their customers. The Tribunal noted that the refund was allowed by the adjudicating authority initially.

2. The Commissioner (Appeals) rejected the refund claim on the grounds of being time-barred as it was filed after the limitation period of one year. The Tribunal held that since the service tax was not paid under protest or in provisional assessments, the limitation period applies. Only a part of the refund amount fell within the limitation period, making the amount beyond the period inadmissible to the appellant.

3. The Commissioner (Appeals) also rejected the refund claim based on unjust enrichment. The Tribunal found that as the appellant was the recipient of the services and paid the service tax on reverse charge basis, the question of recovering the tax from the service provider did not arise. Therefore, the Tribunal held that the appellant succeeded on the issue of unjust enrichment. A part of the demand being beyond the limitation period, the matter was remanded to the original adjudicating authority to quantify and sanction the refund claim filed within the normal period.

In conclusion, the appeal was disposed of in favor of the appellant, with the Tribunal remanding the matter for quantifying and sanctioning the refund claim within the normal period.