2022 (4) TMI 254 - AT - Service Tax

Refund of Service Tax - rejection of refund on the ground that the appellant/assessee did not debit the amount of refund claimed, at the time of filing the refund claim, but have debited such amount subsequent to the filing of the refund claim but before adjudication - Rule 5 read with Notification No.27/2012-CE dated 18.06.2012 - Doctrine of Merger - HELD THAT - The action of the Asstt. Commissioner, of issuing of fresh show cause notice, instead of granting refund, in terms of the Final Order of this Tribunal amounts to interference in the justice delivery system. It is also noticed that the appeal before this Tribunal was against order-in-appeal passed by the Commissioner (Appeals). Further, Revenue was not in appeal against the order of the Commissioner (Appeals). It seems that the Asstt. Commissioner, Shri Ravi Babu, has no regard for the order of the superior court/Tribunal, and also does not have any concept of doctrine of merger. Accordingly, the Asstt. Commissioner, Shri Ravi Babu, Central Goods and Service Tax Commissionerate, Delhi North Commissionerate, 17-B, IAEA House, I.P. Estate, New Delhi-110 019 is directed to show cause as to why the proceedings for contempt of court should not be drawn against him and referred to the jurisdictional High Court for further action in accordance with law - last opportunity is granted to the Asstt. Commissioner, Shri Ravi Babu to comply with the final order of this Tribunal and to file compliance, which should be filed before 25.04.2022. Put up for further hearing and order on 25.04.2022.

Summary

Issues:
Refund claim compliance under Rule 5 with Notification No.27/2012-CE - Proper rejection grounds - Debit of refund amount before adjudication - Interference in justice delivery system by Asstt. Commissioner - Contempt of court proceedings against Asstt. Commissioner - Compliance deadline.

Analysis:
The Appellate Tribunal CESTAT New Delhi addressed the issue of refund claim compliance under Rule 5 with Notification No.27/2012-CE. The Tribunal considered whether the rejection of the claim by the lower court was justified due to the timing of debiting the refund amount. The Tribunal held that debiting the amount of refund claim in the cenvat credit account before adjudication was sufficient compliance with the notification. The Tribunal also emphasized a ruling of the Hon'ble Supreme Court to support its decision.

Regarding the actions post the Tribunal's final order, the appellant approached the Department for refund as directed by the Tribunal. However, the Asstt. Commissioner issued fresh show cause notices instead of granting the refund, which the Tribunal deemed as interference in the justice delivery system. The Tribunal noted that the Revenue was not in appeal against the Commissioner (Appeals) order and criticized the Asstt. Commissioner for disregarding the Tribunal's order and the doctrine of merger.

Consequently, the Tribunal directed the Asstt. Commissioner to show cause why contempt of court proceedings should not be initiated against him and referred to the High Court for further action. Alternatively, the Asstt. Commissioner was given a final opportunity to comply with the Tribunal's order and submit the necessary compliance by a specified deadline.

In conclusion, the Tribunal highlighted the importance of adherence to judicial orders and directed the Asstt. Commissioner to comply with the order or face potential contempt proceedings. The case was scheduled for further hearing and order on a specified date.