2018 (1) TMI 559 - AT - Service Tax

Refund claim - time limitation - Section 11B of the CEA, 1944 - Held that - the refund application was filed by the appellant and decided by the authorities u/s 11B of the Act, the time limit prescribed therein should be strictly followed in entertaining the refund application - The law is well settled that the adjudicating/appellate authorities being the creature under the statute, are duty bound to obey the provisions of statute contained therein - rejection of refund justified - appeal dismissed - decided against appellant.

Summary

Issues:
Rejection of refund claim under Section 11B of the Central Excise Act, 1944 on the ground of limitation.

Analysis:
The case involved the rejection of a refund claim under Section 11B of the Central Excise Act, 1944 on the grounds of limitation. The appellant sub-licensed its premises to different parties, receiving interest-free security deposits for a period of 9 years and 11 months. The service tax department's audit team observed that the appellant was liable to pay service tax on Notional Interest earned on the security deposit. The appellant deposited the service tax and filed a refund application claiming &8377; 31,32,562.75. However, the refund application was rejected as being beyond the prescribed time limit under Section 11B of the Act.

The appellant argued that the amount deposited cannot be considered as service tax and thus, the time limit under Section 11B should not apply. The appellant cited various judicial decisions to support this argument. On the other hand, the Revenue contended that since the appellant paid service tax under the category of renting of immovable property service and claimed a refund under Section 11B, the time limit prescribed in the statute is strictly applicable.

The Tribunal noted that the appellant paid service tax under the category of renting of immovable property service and filed a refund application under Section 11B. The Tribunal emphasized that the authorities are bound by the statutory provisions and must adhere to the time limit for refund applications. Referring to Supreme Court judgments, the Tribunal held that the authorities must follow the limitation period prescribed in the Act and cannot decide differently. The Tribunal found no merit in the appellant's arguments and dismissed the appeal, upholding the rejection of the refund application.

In conclusion, the Tribunal upheld the rejection of the refund claim, emphasizing the importance of adhering to the statutory provisions, especially regarding the time limit for filing refund applications under Section 11B of the Central Excise Act. The Tribunal highlighted the binding nature of the statutory provisions on the authorities and dismissed the appeal based on established legal principles and lack of contrary judgments on the issue cited by the appellant.