2018 (10) TMI 764 - AT - Service Tax

Refund of CENVAT Credit - section 11B of the Central Excise Act, 1944 - rejected for the reason that they have taken CENVAT credit of the amount which has been collected by Canara Bank - appellants have not produced necessary documents to show that the Canara Bank has collected service tax - Held that - Appellants have replied to the SCN along with necessary documents to support that they have not taken any CENVAT credit and they have borne the tax incidence. However, it is borne out from the records that the authorities below have not considered these documents - the matter requires to be remanded to the adjudicating authority for considering the documents that are produced by the appellants for establishing their case - appeal allowed by way of remand.

Summary

Issues:
Refund claim under section 11B of the Central Excise Act, 1944 rejected by original authority and upheld by Commissioner (Appeals) due to alleged availing of CENVAT credit by the appellant.

Analysis:
The appellants provided facility management services to Canara Bank and discharged service tax for such services. However, Canara Bank mistakenly collected service tax from the appellants for the same activity and deposited it to the Government. The appellants filed a refund claim under section 11B for the double payment of service tax. The show cause notice alleged that the appellants had taken CENVAT credit of the service tax paid to Canara Bank, which was the sole ground for rejection. The appellant argued that since Canara Bank collected the tax by mistake, they did not avail CENVAT credit and provided necessary proof to establish this. The appellant bore the tax incidence themselves, as confirmed by Canara Bank's certificate. Despite producing documents, the authorities did not consider them.

The respondent contended that the appellants failed to provide documents showing Canara Bank's collection of service tax and the appellant bearing the tax incidence related to the refund claim. After hearing both sides, it was revealed that the department issued a letter stating the rejection of the refund claim due to alleged CENVAT credit availed by the appellant from Canara Bank. The authorities did not consider the documents submitted by the appellants, leading to the conclusion that a remand was necessary. The appellate tribunal set aside the impugned order, allowing the appeal by way of remand. The adjudicating authority was directed to reconsider the case, giving the appellant an opportunity to produce necessary documents and have a personal hearing for further clarification.

In conclusion, the judgment highlighted the importance of considering all relevant documents and evidence presented by the parties involved in a refund claim dispute. The tribunal emphasized the need for a fair assessment of the appellant's case and directed a remand to the adjudicating authority for a thorough review based on the documents provided by the appellant to establish their position regarding the alleged availing of CENVAT credit.