2008 (11) TMI 117 - AT - Service Tax

Rejection of refund claim u/s 11B of CEA, 1944 as applicable to service tax on the ground of unjust enrichment - appellants were engaged in production of TV serial/programme for various TV channels - appellant wrongly paid the service tax under category of Video Production Agency service invoices issued show that service tax has been separately charged therein - therefore, by virtue of S. 12B, it can be presumed that incidence of duty had been passed to buyer refund was rightly rejected

Summary

Issues:
Appeal against rejection of refund claim under section 11B of the Central Excise Act, 1944 on the ground of unjust enrichment.

Analysis:
1. The appellant, engaged in TV serial production, wrongly paid service tax under "Video Production Agency" service category. The refund claim was rejected by the Deputy Commissioner and Commissioner (Appeals) on the ground of unjust enrichment despite the modification of the adjudication order.

2. The appellant argued that they charged a composite price to the client, which included service tax, and provided a certificate from the client. However, the invoices showed a separate charge for service tax, leading to the presumption that the tax incidence was passed on to the customers as per section 12A of the Central Excise Act, 1944.

3. The Tribunal referred to the JCT Ltd. and Skycell Communications Ltd. cases, emphasizing that the burden of duty is considered passed to the customer if the selling price is inclusive of duty. The appellant failed to produce evidence to rebut this presumption, as per the agreement terms holding them responsible for all taxes.

4. Various Tribunal decisions cited by the appellant were deemed irrelevant. Distinctions were drawn from cases where refunds were claimed by customers, or where the burden of tax was not passed on to the customers, contrasting with the present case where no evidence was presented to show non-passing of tax burden.

5. Ultimately, the Tribunal found no merit in the appeal, as the appellant failed to substantiate that the tax burden was not transferred to the customers. The appeal was consequently rejected based on the evidence and legal provisions discussed in the judgment.