2008 (1) TMI 273 - AT - Service Tax

In terms of Not.43/97-ST, the appellants were not required to pay service tax for the GTO service availed during 16.11.97 to 1.6.98 - appellants had paid the impugned tax under protest - In such a case, limitation of one year did not apply to the refund due - amount was paid under protest can t be treated as tax as the same was collected without the authority of law - appeal is allowed - amount of tax collected from the appellants during the periods 1998-99 and 1999-2000 shall be refunded

Summary

Issues:
1. Waiver of predeposit and stay of recovery.
2. Demand of service tax on Goods Transport Operator (GTO) service.
3. Time bar on refund claim.
4. Retrospective amendment of Notification No.43/97.
5. Applicability of limitation on refund claim.

Analysis:

1. The application by M/s. Wardex Pharmaceuticals (P) Ltd sought waiver of predeposit of Rs.2,15,463/- along with interest and stay of recovery. The Tribunal waived the predeposit requirement after hearing both sides and proceeded with the appeal's disposal.

2. The issue arose from the Finance Act, 2000, which sought to recover service tax on GTO service retrospectively. The appellants were issued a notice proposing to demand service tax of Rs.2,15,463/- on GTO service availed by them. The appellants paid the tax due on 12.11.2003 as directed, and the Assistant Commissioner granted a refund. However, the Commissioner later found the refund claim filed on 18.8.2006 to be time-barred and ordered recovery of the refunded amount.

3. The Commissioner held that the refund claim was time-barred as it was filed beyond the stipulated period after payment. The appellants argued that the retrospective amendment of Notification No.43/97 entitled them to a refund without the limitation applying. The appellants claimed the payment was made under protest, and the limitation did not affect their claim.

4. The appellants contended that the retrospective amendment of Notification No.43/97 was intended to grant them a refund. They argued that the department should have granted a suo motu refund following the amendment. The appellants claimed that the revision of the original authority's order was unjustified.

5. The Tribunal analyzed previous decisions, including CCE, Chennai Vs. Rane Engine Valves Ltd and CCE, Raipur Vs. Indian Ispat Works (P) Ltd, to support the appellants' claim that the limitation did not apply to their refund claim. The Tribunal held that the amount paid was under protest and not to be treated as tax collected with the authority of law. Therefore, the appeal by M/s. Wardex Pharmaceuticals (P) Ltd was allowed, and the stay application was disposed of.