2021 (5) TMI 8 - AT - Service Tax

Refund of Service tax - Requirement to debit the amount to be claimed as refund claimed on 30.6.2017 or not? - refund denied on the ground that on 30.6.2017 while shifting to GST regime, they have not debited the refund amount from the Cenvat Credit account in terms of Notification No.27/2012-CE (NT) dated 18.6.2012 - HELD THAT - The provisions of Notification No.27/2012-CE (NT) dated 18.6.2012 are very much clear that the assessee is required to debit the amount of refund claim in Cenvat credit account at the time of filing of refund claim. Therefore, the observations made by both the authorities below are contrary to Notification No.27/2012-CE (NT) dated 18.6.2012. As the appellant has complied with the conditions of Notification No.27/2012-CE (NT) dated 18.6.2012 is evident from the facts of the case. There are no merit in the impugned order rejecting refund claim filed by the appellant, therefore, the same is set aside - appeal allowed - decided in favor of appellant.

Summary

Issues:
- Denial of refund claim under Notification No.27/2012-CE (NT) dated 18.6.2012 due to failure to debit the amount from Cenvat Credit account while shifting to GST regime.

Analysis:
The appellant filed a refund claim of &8377; 6,24,440/- for the quarter ending June 2017, related to unutilized Cenvat Credit Account for exportation of service under Rule 5 of Cenvat Credit Rules, 2004. The claim was denied as it was not debited from the Cenvat Credit account on 30.6.2017 during the transition to the GST regime. The appellant contended compliance with Notification No.27/2012-CE (NT) dated 18.6.2012, requiring the debit of the refund amount at the time of filing the claim. Both lower authorities rejected the claim, stating the need to reverse the deemed credit under Rule 5 of Cenvat Credit Rules, 2004 upon the introduction of GST on 1.7.2017, which was not done by the appellant at that time.

The Tribunal examined the facts and the relevant notification, noting that the appellant had indeed debited the refund amount in the Cenvat Credit account at the time of filing the claim. The issue revolved around the interpretation of Notification No.27/2012-CE (NT) dated 18.6.2012 and whether the appellant was required to debit the amount on 30.6.2017. The Tribunal emphasized the clear provisions of the notification, stating that the assessee must debit the refund claim amount at the time of filing. Consequently, the Tribunal found the lower authorities' observations contradictory to the notification. Since the appellant had fulfilled the conditions of the notification, the impugned order denying the refund claim was deemed meritless. Therefore, the Tribunal set aside the order and allowed the appeal, granting consequential relief if applicable.