2016 (9) TMI 1057 - AT - Service Tax

Refund claim - whether 7-11-2014, the date on which the original refund claim was filed, should be considered as the date of filing the refund claim, or the date of filing the revised application which is on 8-2-2015 should be the relevant date - Held that - it is observed that the original refund claim was submitted within the time limit prescribed. The appellant filed a revised claim after a couple of months realising that there was some wrong calculation/error in the original refund claim, in the sense that items and serial numbers from 7 to 18 was not eligible for the refund. Therefore, they omitted the same and filed a revised claim for a lower amount. We find the action of the appellant bona fide. The said action of the appellant does not in any way negate the original refund claim which was filed within the time limit. If the appellant had not come forward and had suo motu omitted the said portion of the refund claim, which were not eligible for refund, the department would have rejected the said portion of the refund claim and would have sanctioned the refund for the balance portion of the refund claim. Therefore, the action of the appellant of suo motu omitting the portion of the refund claim not eligible for refund has only facilitated the department and does not vitiate the original refund claim. Hence, the decision of the lower authorities to hold that a portion of the refund claim amounting to ₹ 1,80,290/- is barred by limitation on the ground that the revised claim was filed after the prescribed time limit is unfair, unjust and not sustainable. It is observed that the original refund claim filed on 7-11-2014 included this amount also, and was filed within prescribed time limit. - Appeal allowed by way of remand

Summary

Issues:
Date of filing the refund claim - Original claim vs. Revised claim

Analysis:
The case involved a dispute regarding the relevant date of filing a refund claim by M/s. Banco Products India Limited. The appellant initially filed a refund claim for &8377; 5,45,657/- on 7-11-2014, within the prescribed time limit. Subsequently, realizing errors in the original claim, they omitted certain items and filed a revised claim for a reduced amount of &8377; 4,96,486/- on 8-1-2015. The key issue was whether the date of the original claim or the date of the revised claim should be considered as the relevant date for filing the refund claim.

Upon hearing both sides and examining the records, it was noted that the original refund claim was indeed submitted within the stipulated time frame. The appellant's decision to file a revised claim arose from the discovery of errors in the original claim, specifically regarding certain items not eligible for refund. By voluntarily omitting these items in the revised claim, the appellant acted in good faith, which did not invalidate the original claim filed within the deadline. Had the appellant not rectified the errors, the department would have rejected the ineligible portion of the claim and sanctioned the refund for the eligible amount. Therefore, the lower authorities' decision to reject a portion of the refund claim amounting to &8377; 1,80,290/- as time-barred due to the revised claim was deemed unfair and unsustainable. The original claim, inclusive of this amount, was submitted within the prescribed time limit.

Consequently, the appellate tribunal found that the rejection of the refund claim amounting to &8377; 1,80,290/- by the lower authorities was not justified. The tribunal directed the adjudicating authority to reconsider this specific claim on its merits, treating it as filed within the time limit. As a result, the appeal was allowed by remanding the case for further examination by the adjudicating authority.