2018 (10) TMI 645 - AT - Service Tax

Refund of service tax paid - refund claimed on the ground that VAT on logistic charges have been paid - refund rejected on the ground of time limitation and unjust enrichment - Held that - There is no dispute that the refund claims stand filed after the normal period of limitation provided under Section 11 B of the Central Excise Act. It is well settled law that the Tribunal has no constitutional jurisdiction so as to allow the refund claim in deserving cases, by by-passing the limitation provided under the Act - refunds having been filed beyond the period of limitation are fully time barred and as such are required to be rejected on the said ground itself, without further going into the unjust enrichment angle - appeal dismissed - decided against appellant.

Summary

Issues:
1. Refund claim of service tax filed beyond the period of limitation.
2. Denial of refund claim based on unjust enrichment.
3. Applicability of Section 11 B of the Central Excise Act to refund claims.

Analysis:
The judgment by the Appellate Tribunal CESTAT ALLAHABAD involved two appeals being disposed of through a common order due to arising from the same impugned order and related facts. The appellant, running an authorized service station and dealership of Hyundai vehicles, started paying service tax on logistic charges collected from customers after a Revenue objection. Subsequently, Commercial Tax Authorities demanded VAT on these charges, which the appellant paid. The appellant then filed a refund claim for service tax paid, citing payment of VAT on the same service. However, the refund claim was denied by authorities citing limitation and unjust enrichment.

The appellant argued that they deposited the VAT amount with authorities post its confirmation, although the VAT order was challenged in the High Court. The appellant contended that only one tax should be payable, seeking a refund of the service tax without time bar considerations. The Revenue countered, citing Section 11 B provisions requiring refund claims within one year from the relevant date. The Revenue stressed adherence to Act provisions without authority to extend the period, even if it results in adverse orders against the assessee.

The Tribunal concurred with the Revenue, emphasizing that the refund claims exceeded the limitation under Section 11 B, precluding consideration of unjust enrichment. Citing legal precedent, the Tribunal held that it lacked jurisdiction to allow refunds beyond statutory limitations, as established in the Procelain Electrical Mfg. case. Consequently, the Tribunal rejected both appeals due to being time-barred, without delving into unjust enrichment considerations. The judgment underscores the importance of adhering to statutory limitations for refund claims under the Central Excise Act, highlighting the Tribunal's inability to bypass such constraints even in deserving cases.