2017 (1) TMI 1025 - HC - Service Tax

Refund claim - having discharged the entire liability, whether the petitioner was entitled for refund of the amount remitted by Airport Authority of India to the 3rd respondent? - Held that - There is no dispute about the fact that the petitioner had satisfied the service tax liability in respect of the service done by him as evident from Ext.P14 order itself. It is with reference to the very same service that the petitioner had undertaken, the Airport Authority of India had adjusted his security deposit, recovered the amount from his bills and remitted the same to the 4th respondent. In other words, it is a double payment of service tax which cannot be disputed under the facts. There is no reason why such an amount should be retained by the 3rd respondent - refund allowed - petition allowed - decided in favor of petitioner.

Summary

Issues:
1. Entitlement of the petitioner for refund of service tax amount remitted by Airport Authority of India.
2. Double payment of service tax and the necessity of refund.

Analysis:
Issue 1: The petitioner, a contractor, sought a refund of the service tax amount remitted by the Airport Authority of India. The petitioner had paid service tax as per the return filed for the period in question. However, the Airport Authority of India adjusted the service tax amount from the petitioner's security deposit and remitted it to the concerned authority. The petitioner claimed entitlement to a refund since the service tax liability had been discharged. The court examined Ext.P14, which stated that the petitioner could not claim a refund as the service tax paid could be availed as CENVAT credit. The court considered the provisions of CENVAT Credit Rules, 2004, and concluded that the petitioner was not entitled to a refund based on the existing circumstances.

Issue 2: The court acknowledged that the petitioner had already satisfied the service tax liability for the services provided. It noted that the Airport Authority of India had recovered the same amount from the petitioner and remitted it, resulting in a double payment of service tax. Referring to a judgment by the Apex Court, the court emphasized that the petitioner, having provided services and collected fees accordingly, should not be subject to double taxation. The court directed the 4th respondent to seek a refund from the concerned authority and instructed the 3rd respondent to refund the amount promptly to prevent double taxation. The judgment set aside Ext.P14 and outlined a clear process for the refund, ensuring the petitioner's rights were upheld without unnecessary delay.