9911796707
|
Home
Issues involved: Refund of service tax by insurance company to insured and intermediaries, verification of refund claims, adjustment of service tax liability, interpretation of Service Tax Rules.
Summary: The case involved the appellant, an insurance company providing general insurance services through intermediaries like banks and insurance brokers. The appellant refunded service tax along with insurance premium to insured individuals who rejected policies, adjusting these amounts against their service tax liability as per Rule 6(3) of Service Tax Rules, 1994. The Revenue raised concerns about the correctness of these adjustments for the period Oct. '09 to Sept. '10, leading to a Show Cause Notice and demand of Rs. 2,83,97,950/-, with Rs. 1,03,86,098/- related to refunds directly paid to insured and Rs. 1,80,11,854/- related to refunds paid through intermediaries. In the case of refunds directly to insured, the Revenue disallowed the adjustments as the appellant failed to produce verification of Bank Reconciliation Statements and vouchers for 47 selected cases. The appellant explained the difficulty in tracing old vouchers due to the volume of records but later located them. For refunds through intermediaries, the appellant argued that credits in intermediary accounts constituted refunds, allowing for future premium and service tax payments. The Revenue contended that unless service tax was proven to be refunded to insured, adjustments under Rule 6(3) could not be allowed, expressing concerns about potential revenue loss. The Tribunal, considering both arguments, disagreed with the Revenue's stance on intermediary refunds, stating that credited amounts were part of advance deposits available for future payments. The Tribunal emphasized that the Service Tax Rules did not mandate specific refund methods and remanded the matter for re-verification, following a previous order in a similar case. The Tribunal highlighted the need for evidence of revenue loss due to malpractices and directed disclosure of such evidence to the appellant for defense. Ultimately, the Tribunal set aside the impugned order, remitting the case for de-novo adjudication in line with previous orders and ensuring the opportunity for the appellant to present a defense. The stay application and appeal were disposed of accordingly.
|
