2017 (6) TMI 328 - AT - Service Tax

Refund claim - excess duty paid on 100% of the freight charges without availing the benefit of abatement of 75% of freight under N/N. 32/2004 ST dated 03.12.2004 - denial on account of time limitation and also on the ground that mere rubber stamp affixed on the bills do not fulfill the condition stipulated under the said notification - Held that - the refund claim is not hit by limitation of time - the declaration contained in the rubber stamp affixed on the bills and consignment notes issued by the GTA are valid declaration by the GTA and it satisfies the requirement of the notification because in the notification no specific format has been prescribed for the declaration and it is only the CBEC Circular dated 12.03.2007 which prescribed such kind of endorsement. The findings of the Commissioner in the impugned order that no documents have been supplied by the appellant is not tenable as it has been recorded that the appellants have supplied the documents/worksheets evidencing as to how the refund amount was arrived at - the bar of unjust enrichment is not applicable because the appellant has paid the service tax under reverse charge. Appeal allowed - decided in favor of appellant.

Summary

Issues: Appeal against rejection of refund claim for excess service tax paid due to incorrect calculation and non-compliance with Notification No. 32/2004 ST.

Analysis:
1. Issue of Limitation: The appellant filed a refund claim for excess service tax paid on freight charges, citing inadvertent payment on 100% instead of 25% under Notification No. 32/2004 ST. The lower authority rejected the claim for certain periods due to time limitation under Section 11B of the Central Excise Act, 1944. The Commissioner (Appeals) disagreed, stating the claim was within the limitation period of one year. The Tribunal concurred, finding the claim not time-barred.

2. Compliance with Notification: The appellant argued that the rubber stamp declaration on bills sufficed as per the notification, supported by judicial precedents and CBEC Circular dated 12.03.2007. The Commissioner (Appeals) had held otherwise, emphasizing the lack of specific documents on how the 25% tax calculation was made. The Tribunal disagreed, accepting the appellant's submission that the rubber stamp declaration met the notification's requirements, especially as no prescribed format was specified. The Tribunal also noted that necessary documents were indeed provided, contrary to the lower authority's finding.

3. Unjust Enrichment: The appellant contended that no unjust enrichment occurred as the excess tax was not passed on, supported by a CA certificate. The Tribunal agreed, emphasizing the reverse charge mechanism and the absence of passing on the tax burden. This stance further supported the appellant's entitlement to interest as per the Supreme Court's ruling in Ranbaxy Laboratories Ltd. v. UOI.

In conclusion, the Tribunal set aside the impugned order, allowing the appeal and granting consequential relief to the appellant. The judgment highlighted the importance of compliance with notification requirements, the validity of rubber stamp declarations, and the absence of unjust enrichment in refund claims under the reverse charge mechanism.