2019 (6) TMI 571 - AT - Service Tax

Refund of service tax paid - construction of residential complex services - time limitation - refund was rejected on the ground of time limitation - it appeared that the claim for refund has been filed beyond the period of one year as required under Section 11B and therefore the entire claim was hit by limitation of time - HELD THAT - When the appellant received the advance from the buyers along with Service Tax and paid the same to the Government as Service Tax and if subsequently, the contract was cancelled between the appellant and his buyers and the appellant filed the refund claim on the ground that no service was provided and hence the provision of Section 11B of Central Excise Act is not applicable is devoid of force. The Larger Bench in M/S VEER OVERSEAS LTD. VERSUS CCE, PANCHKULA 2018 (4) TMI 910 - CESTAT CHANDIGARH after examining the various decided cases has come to the conclusion that the claim of refund of Service Tax is subject to the provision of Section 11B for period of limitation. Appeal dismissed - decided against appellant.

Summary

Issues:
Refund claim filed beyond the time limit prescribed under Section 11B of the Central Excise Act for Service Tax paid by the appellant.

Analysis:
The appellant undertook the construction of a residential complex but faced a setback when the NOC from M/s HAL was revoked, leading to a restriction on the number of floors in the complex. Subsequently, customers who had booked flats sought refunds, resulting in M/s Chalet Hotels Pvt. Ltd. filing refund claims for Service Tax paid on refunded amounts. The refund claim, filed in August 2017, was rejected by the Assistant Commissioner as time-barred under Section 11B. The appellant appealed this decision, arguing that Section 11B does not apply as they did not provide the service and are entitled to a refund under Rule 6(3) of the Service Tax Rules. The appellant cited various tribunal decisions to support their claim.

The respondent contended that Service Tax was leviable when the advance was received, and the appellant had provided the service, collected, and paid the tax to the Government. The respondent argued that the decisions cited by the appellant were not applicable, and the issue of limitation under Section 11B was settled by a Larger Bench decision. Additional tribunal decisions were presented by the respondent to support their stance.

The Tribunal, after considering submissions from both parties, referred to the Larger Bench decision in the case of Veer Overseas Ltd. and highlighted that the claim for refund of Service Tax is subject to the provisions of Section 11B for the period of limitation. The Tribunal emphasized that the statutory time limit cannot be extended by any authority, as held by the Apex Court. Therefore, the Tribunal upheld the impugned order, dismissing the appeal of the appellant based on the precedent set by the Larger Bench decision.

In conclusion, the Tribunal's decision was based on the interpretation of Section 11B concerning the time limit for refund claims of Service Tax paid, aligning with the findings of the Larger Bench decision and rejecting the appellant's argument against the applicability of Section 11B in their case.