2016 (12) TMI 794 - AT - Service Tax

SEZ - rejection of refund claim - refund of CENVAT credit availed on rent-a-cab service - denial on the ground that the service provider M/s. Mahindra Logistics has mentioned the place as Mumbai in the invoice - time bar - Held that - Since the refund application in terms of Notification No.40/2012-ST dated 26.02.2012 was filed by the appellant on 17th Jan., 2014, immediately upon obtaining the permission from the Development Commissioner, in my view, such delay should have been condoned by the service tax authorities. Clause (e) contained in the Notification dated 20.06.2012 clearly provides that the Assistant Commissioner or the Dy. Commissioner of Central Excise shall permit the applicant to file the application even beyond the period of limitation. Since due to the genuine and practical difficulties, the appellant was not in a position to obtain the permission from the Development Commissioner, it has applied for extension of time period for filing the refund application before the service tax authorities. The action on the part of the appellant seems reasonable and justified for the purpose of condonation of delay, which has specifically been provided in the Notification. Thus, I am of the view that rejection of refund claim on the ground of limitation will not hold good and the application should merit consideration for grant of refund. The certificate placed at page 204 in the appeal paper-book clearly shows that the transportation services were availed by the appellant for transportation of its employees from Indore to Pithampur and back. Thus, wrong mention of the name of place i.e. Bombay will not take away the benefit of refund, to which the appellant is statutorily entitled to. Appeal allowed - refund allowed - decided in favor of appellant-assessee.

Summary

Issues involved:
1. Denial of refund claim on the grounds of limitation and lack of approval for rent-a-cab service.
2. Delay in filing the refund application and condonation of delay.
3. Interpretation of the Notification No.40/2012-ST dated 20.06.2012 regarding the time limit for filing refund applications.

Analysis:

Issue 1: Denial of refund claim
The appellant, a Special Economic Zone engaged in manufacturing, availed Cenvat credit for rent-a-cab service during May 2012 to July 2013. The refund application was rejected on the grounds that the service provider mentioned Mumbai as the place, and the refund claim was beyond the time limit. The ld. Commissioner upheld the rejection. The Tribunal noted the delay in obtaining permission for rent-a-cab service from the Development Commissioner after application. The Tribunal opined that the delay should have been condoned as the appellant filed the refund application promptly upon receiving permission. The Notification allows for the extension of the time limit. Citing a Supreme Court judgment, the Tribunal emphasized that the benefit should accrue from the date of application, even if administrative delays occur.

Issue 2: Delay in filing the refund application
The appellant argued that the delay in filing the refund application was due to the late issuance of the authorization certificate by the Development Commissioner. The appellant contended that the delay should be condoned as they promptly filed the application upon receiving the authorization. The Tribunal agreed, stating that the delay was justified due to practical difficulties faced by the appellant. The Tribunal highlighted the clause in the Notification allowing for the extension of the time limit.

Issue 3: Interpretation of Notification No.40/2012-ST
The Revenue argued that the time limit prescribed in the Notification must be strictly complied with. However, the Tribunal emphasized that the Notification provides for condonation of delay by the authorities. The Tribunal cited a case to support the liberal interpretation of exemption notifications once the eligibility criteria are satisfied. The Tribunal concluded that the wrong mention of place in the invoices should not deprive the appellant of the refund, as evidenced by the transportation services provided.

In conclusion, the Tribunal found no merit in the impugned order and allowed the appeal in favor of the appellant, granting them the consequential benefit of the refund.