2016 (12) TMI 927 - AT - Service Tax

Refund claim - Business Auxiliary Service - refund claimed of the amount paid twice, due to non-receipt of challans - whether refund claim justified? - Held that - the circumstances under which the accountant made double payment erroneously is not doubted. This is an human error and the appellant should not be put to unending harassment and difficulty for no fault on his part. I also find from the records that the appellant had approached the Service Tax authorities on 29/12/2009 by filing a refund claim. At this stage, it is the authorities who could have guided him to treat the excess payment as advance payment towards the liability of the subsequent month/quarter which is allowed regularly by the Department on an intimation being filed by the assesse. Since much time has elapsed and this option is not now available to the appellant assesse, the only option left is to refund the excess amount lying with the Department - matter remanded to the adjudicating authority to grant refund of the excess amount of ₹ 1,54,540/- lying with the Department by virtue of double payment by the appellant.

Summary

Issues:
1. Refund claim for double payment of Service Tax.
2. Clarification on excess payment and admissibility of refund claim.

Analysis:
1. The appellant, registered under Service Tax for Business Auxiliary Service, made double payment of Service Tax for services rendered in September 2009. The Chief Accountant paid the tax twice on the same day, totaling ?1,54,540. The appellant filed a refund claim before the Commissioner of Service Tax due to the erroneous double payment. The Deputy Commissioner issued a Show Cause Notice, questioning the delay in payment and the lack of clarification on the excess payment. The Deputy Commissioner rejected the claim, stating the matter was not clarified. The lower appellate authority upheld the decision, leading to the appeal before the Tribunal.

2. During the hearing, the Chief Accountant explained the circumstances of the double payment and provided copies of both challans. The Assistant Commissioner reiterated the lower authorities' findings. The Tribunal observed that both challans were generated on the same day for the same amount, confirming the inadvertent double payment. Recognizing the human error, the Tribunal directed the adjudicating authority to grant a refund of the excess amount to the appellant. The Tribunal suggested the authorities could have guided the appellant to treat the excess payment as an advance for the subsequent period, a practice allowed by the Department. As this option was not pursued, the Tribunal ordered the refund of ?1,54,540 to the appellant, emphasizing cooperation in verifying payment details. The appeal was allowed, remanding the matter for refund processing within three months.