2019 (8) TMI 490 - AT - Service Tax

Refund of service tax paid - time limitation - N/N. 12/2013-ST dated 01.07.2013 - Section 11B of the Central Excise Act, 1944 - part refund rejected also on the ground that the input services are commonly used for both SEZ and DTA operations - HELD THAT - The appellant has submitted that in their own case for the period January to March 2015, Deputy Commissioner, Mangalore has allowed the refund claim on identical facts and the same has not been challenged by the Revenue and has attained finality. The appellant does not have any DTA unit, they are only making supply to a DTA unit whereas the conditions of Para 3(III)(a) would be applicable only when the assessee has units in both SEZ and DTA whereas in the present case, the appellant has unit only in SEZ and make supply from SEZ to DTA unit and therefore the said condition of Para 3(III)(a) is not applicable in the present case - the denial of refund to the appellant is not sustainable in law. Rejection of refund on the ground of time limitation - HELD THAT - The combined reading of Para 3(III)(e) and 3(III)(f) of the Notification clearly shows that the refund claim were within time limit - the denial of refund on time barred is also not sustainable. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund claim time-barred under Notification No. 12/2013-ST dated 01.07.2013
Refund claim not made in proportion to authorized operations in SEZ
Interpretation of conditions under Notification No. 12/2013-ST dated 01.07.2013
Applicability of conditions in Para 3(III)(a) of the Notification
Denial of refund on time bar

Refund claim time-barred under Notification No. 12/2013-ST dated 01.07.2013:
The appellant filed a refund claim for Service Tax paid for specified services received for authorized operations in the SEZ. The claim was rejected as time-barred since it was not filed within one year from the end of the month in which the actual payment of Service Tax was made, as required by Notification No. 12/2013-ST dated 01.07.2013. The original authority rejected the claim under Section 11B of the Central Excise Act, 1944. The appellant argued that the time limit should be based on a quarterly basis, relying on the decision in CCE Vs Span Infotech India Pvt. Ltd. The Tribunal found that the refund claim was within the time limit as prescribed in the Notification, and the denial of refund on time bar was not sustainable.

Refund claim not made in proportion to authorized operations in SEZ:
The appellant's refund claim was rejected on the grounds that the input services were used both in SEZ and DTA operations, contrary to the claim that the refund was used exclusively for authorized operations in SEZ. The appellant contended that they did not have a DTA unit and only made supplies to a DTA unit, which should not be subject to the conditions of Para 3(III)(a) of the Notification. The Tribunal agreed with the appellant, stating that the conditions of Para 3(III)(a) apply when the assessee has units in both SEZ and DTA, which was not the case here. The denial of refund on these grounds was deemed unsustainable in law.

Interpretation of conditions under Notification No. 12/2013-ST dated 01.07.2013:
The Tribunal analyzed the conditions under Notification No. 12/2013-ST dated 01.07.2013 to determine the eligibility for the refund claim. The appellant argued that the terms of the Notification were misinterpreted by the authorities, citing previous decisions where similar refund claims were allowed. The Tribunal found that the impugned order did not properly appreciate the facts and the law, ultimately leading to the rejection of the appeal. The Tribunal held that the denial of refund based on the interpretation of the Notification was not sustainable.

Applicability of conditions in Para 3(III)(a) of the Notification:
The appellant raised concerns regarding the applicability of conditions in Para 3(III)(a) of the Notification, emphasizing that they did not have a DTA unit but only made supplies to a DTA unit. The Tribunal agreed with the appellant's interpretation, stating that the conditions of Para 3(III)(a) would only apply if the assessee had units in both SEZ and DTA, which was not the case here. The Tribunal found that the denial of refund based on the misapplication of Para 3(III)(a) was unsustainable in law.

Denial of refund on time bar:
The Tribunal addressed the issue of denial of refund amounting to &8377; 49,711 on the grounds of being barred by limitation. The Tribunal found that the refund claim was within the time limit as prescribed by the Notification and relied on the decision in the case of CCE Vs Span Infotech India Pvt. Ltd. to support this finding. The Tribunal concluded that the denial of refund on the basis of being time-barred was not sustainable.

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