2021 (6) TMI 705 - AT - Service Tax

Validity of SCN - On the refund already sanctioned by Tribunal, the Revenue issued two show cause notices to re-adjudicate the matter - error on the part of Revenue - violation of principles of natural justice - HELD THAT - After the order of this Tribunal dated 16.10.2019, the authorities below were having the two options i. e. either to challenge the order of this Tribunal before higher forum or to comply the direction of this Tribunal passed on 16.10.2019. As the order dated 16.10.2019 has not been challenged by the respondents, the only option left with the respondent to sanction the refund claim suo-motto and to release the same, no refund claim was required to be filed by the appellant again. Instead of sanctioning the refund claim to the appellant, the adjudicating authority has issued two show cause notices illegally to the appellant on 30.01.2020 and 23.04.2020. Therefore, the show cause notices issued to the appellant are illegal and violation of the legal provisions. The act of the issuance of show cause notice to the appellant shows that arrogance of the departmental officers and they has no faith in judiciary. The said act of the departmental officer cannot be appreciated. Further, these type of actions put burden on the Govt. Of India monetarily and otherwise. The refund claim is allowed - also interest on delayed refund is allowed - appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund claim rejection and denial of interest on delayed refund.

Analysis:
The appellant, an exporter of goods, filed refund claims for service tax paid on services availed during the export of goods. The refund claims were initially rejected, but the Tribunal allowed them in a previous order. However, instead of complying with the Tribunal's order, the Revenue issued show cause notices to re-adjudicate the matter, leading to the rejection of part of the refund claim and denial of interest on delayed refund. The appellant argued that this action was in violation of legal provisions and amounted to contempt of the Tribunal.

The appellant contended that the rejection of the refund and denial of interest were based on flimsy grounds already considered by the Tribunal in its previous order. The appellant sought to set aside the impugned order and have the interest on delayed refund sanctioned. On the other hand, the Revenue opposed the appeals, arguing that only one order had been passed, making four of the appeals infructuous. The Revenue also claimed that since there was no prayer for interest on delayed refund in the appellant's prayer clause, the interest was not payable.

Upon hearing both parties, the Tribunal found that the appellant had correctly filed five appeals based on the common order regarding the refund claims. The Tribunal also noted that the appellant had indeed claimed interest on delayed refund in the grounds, rejecting the objection raised by the Revenue. The Tribunal emphasized that the Revenue had the option to challenge the Tribunal's previous order but chose not to, leading to the obligation to sanction the refund claim without requiring the appellant to file again. The Tribunal criticized the Revenue's issuance of show cause notices as illegal and a violation of legal provisions, highlighting the burden such actions place on the government and the loss of faith in the judiciary and society.

Ultimately, the Tribunal allowed the refund claim and directed the adjudicating authority to comply with the Tribunal's previous order within 30 days. The appellant was also granted interest on delayed refund as per legal precedent. The Tribunal concluded by sending a copy of the order to relevant authorities for appropriate directions, thereby resolving the issues of refund claim rejection and denial of interest on delayed refund in favor of the appellant.