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2021 (6) TMI 541 - AT - Service TaxSEZ unit - Refund of Service Tax - Management or Business Consultant Service - period from July 2017 to September 2017 - claim was filed on 29/05/2018 - rejection refund claim has been filed beyond one year from the end of the month in which actual payment of service tax was made by the claimants - introduction of CGST Act, 2017, by omitting Chapter V of the Finance Act, 1994, by virtue of Section 173 of the CGST Act - Applicability of 12/2013-ST dt. 01/07/2013 - HELD THAT - The appellant has given detailed reasons in their letter dt. 29.05.2018 filed along with the refund claim application wherein they have given specific reasons explaining the delay but the Assistant Commissioner did not consider those reasons and simply observed that they are not genuine. Further it is found that the Notification No.12/2013 itself gives him a discretion to condone the delay for bona fide reasons and in the present case, the reasons given by the appellant are very much genuine. Further in the appellants own case for the earlier period, the delay in filing the refund claim was condoned. In an identical case, the CESTAT, Hyderabad in the case of M/S WS INDUSTRIES (INDIA) LTD VERSUS THE COMMISSIONER OF CUSTOMS CENTRAL TAX 2019 (12) TMI 1091 - CESTAT HYDERABAD has also condoned delay of approximately 3 years in filing the refund claim by relying upon the previous decisions of the Tribunal taking a liberal view in condoning the delay in case of SEZ. The impugned order rejecting the refund claim on time bar is not sustainable in law - Matter remanded back to the original authority for deciding the refund claim on merit - appeal allowed by way of remand.
Issues:
1. Condonation of delay in filing the refund claim under Notification No.12/2013-ST. 2. Discretionary powers of the Assistant Commissioner to extend the time frame for filing the refund claim. 3. Consideration of genuine reasons for delay in filing the refund claim. 4. Applicability of judicial precedents in condoning delay in filing refund claims. 5. Interpretation of exemption Notification regarding time limits for filing refund claims. Analysis: Issue 1: Condonation of delay in filing the refund claim under Notification No.12/2013-ST: The key question in the appeal was whether the Assistant Commissioner was correct in rejecting the request for condonation of delay in filing the refund claim under Notification No.12/2013-ST. The appellant had provided detailed reasons for the delay, citing genuine grounds such as plant closure, loss of files, and employee turnover. The Notification itself granted discretionary powers to condone delays for bona fide reasons. The Tribunal highlighted that in a previous case involving the appellant, a similar delay had been condoned, emphasizing the genuine nature of the reasons provided. The Tribunal also referenced a case from the Hyderabad Bench where a delay of approximately 3 years was condoned in a similar situation, reinforcing the liberal approach to condoning delays in SEZ cases. Issue 2: Discretionary powers of the Assistant Commissioner to extend the time frame for filing the refund claim: The appellant argued that the Assistant Commissioner had the discretionary power to extend the time frame for filing the refund claim under Notification No.12/2013-ST. The appellant contended that the substantial benefit of refund should not be denied, especially when the sanctioning authority had the discretion to grant extensions as stipulated in the Notification. The Tribunal agreed with this argument, emphasizing that the appellant had complied with all conditions of the Notification and the SEZ Act, which provided for the refund of cenvat credit of service tax paid on input services. Issue 3: Consideration of genuine reasons for delay in filing the refund claim: The appellant presented specific reasons for the delay in filing the refund claim, including adverse business conditions, loss of files, and inadvertent misplacement of documents. However, both the Assistant Commissioner and the Commissioner(Appeals) did not adequately consider these reasons, leading to the rejection of the refund claim. The Tribunal found the reasons provided by the appellant to be genuine and criticized the authorities for not appreciating the factual and legal aspects of the case. Issue 4: Applicability of judicial precedents in condoning delay in filing refund claims: The appellant relied on judicial precedents where delays in filing refund claims had been condoned by the Tribunal. The Tribunal noted that in the appellant's own case from a previous period, the delay in filing the refund claim had been condoned. Additionally, the Tribunal referenced a decision from the Hyderabad Bench where delays in filing refund claims had been condoned, highlighting the consistent approach of condoning delays in SEZ cases. Issue 5: Interpretation of exemption Notification regarding time limits for filing refund claims: The Tribunal analyzed the provisions of Notification No.12/2013-ST and emphasized that the Notification provided discretionary powers to condone delays for genuine reasons. The Tribunal interpreted the Notification liberally, highlighting the need for a flexible approach when considering condonation of delays in filing refund claims under SEZ schemes. Overall, the Tribunal found in favor of the appellant, setting aside the impugned order and remanding the case back to the original authority for a decision on the refund claim based on merit within a specified timeframe.
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