2008 (4) TMI 79 - AT - Service Tax

Appellant was paying service tax of freight without claiming the abatement of 75% of the gross amount of freight paid for GTA services - refund filed for excess payment of service tax on realizing mistake - Since the appellant had paid service tax of GTA services received by them, it is an input cost - C.A. s certificate proves that benefit of service tax had not been passed on - no change in the price in the appellant s goods after paying tax refund admissible on merits & on limitation

Summary

Issues:
Refund claim for excess service tax payment, applicability of doctrine of merger, eligibility for refund claim.

Analysis:
1. Refund Claim: The appellant paid service tax without claiming abatement, later realizing the mistake and filing a refund claim. The Assistant Commissioner returned the claim as deficient, but the appellant resubmitted with additional documents. A show cause notice was issued proposing to reject the claim as time-barred. The Assistant Commissioner allowed a partial refund, rejecting a portion as time-barred. The Commissioner (Appeals) allowed the appeal for a specific period, leading to further appeals.

2. Doctrine of Merger: The appellant contested the Commissioner's decision that the doctrine of merger was not applicable, arguing that they were eligible for a refund. The Tribunal found in favor of the appellant, citing judgments supporting the applicability of the doctrine of merger. The Tribunal also noted that the appellant's arguments on eligibility for refund deserved acceptance. The appellant demonstrated that the service tax paid on GTA services was an input cost, and they had not passed on the burden through other means.

3. Eligibility for Refund: The Tribunal, after considering the arguments and cited cases by the appellant's advocate, concluded that the appellants had a valid case on merits. Citing relevant case laws such as Hero Honda Motors Ltd. and others, the Tribunal found in favor of the appellant and allowed the appeal, granting the refund claim.

In conclusion, the Tribunal upheld the appellant's claim for a refund of excess service tax payment, recognizing the applicability of the doctrine of merger and the eligibility for the refund claim based on the input cost nature of the service tax paid. The Tribunal's decision was based on a thorough analysis of the legal arguments and precedents cited, leading to the allowance of the appeal in favor of the appellant.