2019 (9) TMI 750 - AT - Service Tax

Refund of service tax - time limitation - application of time limit of one year - N/N. 14/2016-CE(NT) dated 1.3.2016 - service tax was paid in 2014, project was completed in 2018, refund claim was filing in 2015 on the ground that amount was not fully received - case of appellant is that refund claim cannot be rejected on the ground of time-bar as the notification introducing the time limit was issued only on 1.3.2016 and that the provision of services where completed prior to this date - HELD THAT - When we go by receipt of part payment by the appellant which are 10.11.2014 and 7.7.2015, the refund claim made on 25.11.2016 is beyond the period of one year as discussed by the authorities below. If the payment received by the appellant on 21.5.2018 is to be considered, as argued by the counsel, the refund claim would be premature. The appellant do not have a fit case for grant of refund - refund rightly rejected - appeal dismissed - decided against appellant.

Summary

Issues:
1. Time-barred refund claim rejection based on payment dates and completion of services.
2. Applicability of Notification 27/2012 versus amended notification 14/2016-CE(NT) dated 1.3.2016 on time limitation for refund claims.

Analysis:
1. The case involved a dispute over the rejection of a refund claim by the appellant, a consulting engineer service provider, for service tax paid to CLRI. The appellant entered into an agreement for services in Namibia, receiving partial payments in USD. The refund claim was rejected as time-barred due to the expiry of one year from the payment of service tax and the receipt of foreign exchange. The appellant argued that since the entire payment was not received until 21.5.2018, the claim was not delayed. The completion of services was also cited as a reason for delayed payments, supported by a letter from Namibia confirming project completion on 15.3.2018. However, the authorities upheld the rejection, emphasizing the receipt dates of foreign exchange and the one-year time limit for refund claims.

2. The appellant further contended that Notification 27/2012 did not impose a time limitation, unlike the amended notification 14/2016-CE(NT) dated 1.3.2016, which required claims to be made within one year of receiving payment in convertible foreign exchange after service completion. As the services were exported before the amendment, the appellant argued that the time limit should not apply. The respondent, on the other hand, supported the authorities' decision, highlighting the application of the amended notification to the refund claim filed in 2016, considering the receipt dates of foreign exchange payments. The rejection of the refund claim was justified based on these grounds, leading to the dismissal of the appeal by the tribunal.

In conclusion, the tribunal held that the appellant's refund claim was rightly rejected as time-barred, considering the payment dates and the one-year limit for filing claims after receiving foreign exchange payments. The dispute over the applicability of different notifications was settled in favor of the authorities, upholding the rejection of the refund claim. The appeal was dismissed, affirming the legality of the authorities' decision.