2022 (7) TMI 609 - AT - Service Tax

Seeking Cash Refund of service tax paid on ocean freight - refund sought on the ground that appellant is entitled for Cenvat credit of service tax paid on ocean freight - Section 142(3) read with Section 11B of CEA - HELD THAT - The identical issue of this Tribunal in the case of GALAXY POLY PLAST INDUSTRIES VERSUS COMMISSIONER OF CENTRAL EXCISE ST, VADODARA 2022 (7) TMI 567 - CESTAT AHMEDABAD has remanded the matter holding that Matter remanded to the Adjudicating Authority to decide the case afresh under Section 11B that whether the service tax paid by the appellant on ocean freight is legal and correct or otherwise. Respectfully following the said order, the matter is remanded to the original authority.

Summary

Issues Involved:
Whether the appellant is entitled to a refund of service tax paid on ocean freight based on Cenvat credit entitlement under Section 142(3) read with Section 11B.

Analysis:

The judgment by the Appellate Tribunal CESTAT Ahmedabad, delivered by Hon'ble Mr. Raju, Member (Technical), addressed the issue of the appellant's entitlement to a refund of service tax paid on ocean freight. The appellant claimed the refund on the grounds of being entitled to Cenvat credit of service tax paid on ocean freight, seeking cash refund under Section 142(3) read with Section 11B. The Tribunal considered the submissions from both parties and referred to a similar case involving Galaxy Poly Plast Industries, where the matter was remanded for further review. The Tribunal noted that the lower authorities had rejected the refund claim on the basis that cash refund of Cenvat credit of service tax paid on ocean freight was not admissible under the relevant sections.

The Tribunal highlighted that a Division Bench had referred a similar matter to the Larger Bench in the case of Bosch Electrical Drive India Private Limited vs. Commissioner of GST and Central Excise, Chennai. Therefore, the Tribunal refrained from passing an order on the cash refund of Cenvat credit under Section 142(3) of the CGST Act, 2017. The Tribunal also noted that the appellant had based their claim on a judgment of the Hon'ble Gujarat High Court in the case of SAL Steels Limited, arguing that the levy of service tax itself was illegal. However, since the appellant now argued for a refund of service tax paid on ocean freight, the Tribunal concluded that it would not impact the reference made by the Division Bench. Moreover, the issue of the levy of service tax on ocean freight and the Gujarat High Court judgment were not examined by the lower authorities. Consequently, the Tribunal remanded the matter to the original authority for further consideration in line with the precedent set in the case of Galaxy Poly Plast Industries.