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2022 (4) TMI 934 - AT - Service TaxSEZ unit - refund of service tax - rejection of refund on the ground of period of limitation - last date being public holiday - claim for the period between April, 2017 to June, 2017 had been rejected as the refund application was not filed before 13th April, 2018 i.e. within a period of 1 year in terms of Clause 3(III)(e) of the N/N. 12/2013-ST dated 01.07.2013 - HELD THAT - Admittedly as has been held in the Order-in-Original and Order-in-Appeal in terms of Notification No. 12/2013-ST the last date for filing of such refund application is before 30.04.2018 or to say in specific terms on or before 29.04.2018, though the same is not absolute but qualified being discretionary at the level of refund sectioning authority. However, on examination of the English calendar of the year 2018 in the open Court vis-a-vis Annexure-I, it could be noticed that 28th 29th April, 2018 were weekends and 30.04.2018 was a Government holiday on account of Buddha Purnima. This being the facts on record, learned Commissioner (Appeals) order rejecting the refund solely on the ground that it is hit by the period of limitation is unsustainable and the same is required to be set aside. Refund sanctioned alongwith applicable interest - appeal allowed - decided in favor of appellant.
Issues:
Rejection of refund claim under Notification No. 12/2013-ST based on limitation. Analysis: The Appellant, an SEZ Unit, sought a refund of service tax under Notification No. 12/2013-ST. The Assistant Commissioner of Central Tax Division-V sanctioned a partial refund, but rejected a portion amounting to ?40,70,698 for the period between April to June 2017 due to a perceived delay in filing the refund application beyond the prescribed period of 1 year. The Appellant challenged this decision before the forum. The Appellant's Counsel argued on three main points: (i) the notification did not provide an absolute prohibition for filing beyond 1 year, leaving it to the discretion of the authority; (ii) invoking Section 10 of the General Clauses Act, 1897, which allows an act to be considered done in due time if done on the next working day if the last day is a holiday; and (iii) the Special Economic Zones Act, 2006, which provides an overriding effect to the Act over any other statute, contending that the limitation in the notification cannot restrict the filing period for exemption benefits. The Appellant supported their arguments with references to various judicial decisions. The Appellant urged for setting aside the Commissioner (Appeals) order that refused the refund solely on the ground of limitation. The Respondent, represented by the Authorised Representative, supported the Commissioner (Appeals) decision, emphasizing that discretionary power could only be exercised with sufficient cause for non-compliance. The Respondent argued that the limitation ended a day before the date mentioned in the order, and the SEZ unit's overriding effect could not bypass the stipulations in the notification enabling the SEZ unit to seek exemption through refund. After considering the submissions and examining the case record, the Tribunal referred to Section 10 of the General Clauses Act, 1897. It noted that the last date for filing the refund application was before 30.04.2018, which fell on a Government holiday. The Tribunal found the Commissioner (Appeals) order rejecting the refund solely on the grounds of limitation as unsustainable and set it aside, allowing the appeal and sanctioning the refund of ?40,70,698 with applicable interest to be paid to the Appellant within 3 months. In conclusion, the Tribunal allowed the appeal, directing the refund of the disputed amount and setting aside the Commissioner (Appeals) order that rejected the refund based on limitation.
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