2022 (8) TMI 876 - AT - Service Tax

Refund claim - Retrospective exemption - rejection on the ground of limitation, unjust enrichment and also for violation of the provisions of section 102 (1),(2) and (3) of the Finance Act 1994 - whether the refund claim was filed within the stipulated period contemplated in section 102 (1) that was introduced by Finance Bill 2016? - HELD THAT - This section provided retrospective exemption to construction service for the period commencing from 01.04.2015 to 29.02.2016. At the same time, this section also provided that refund of service tax paid during the period from 01.04.2015 to 29.02.2016 has to be filed within a period of six months from the date of enactment of the Finance Bill 2016 i.e. 14.05.2016. It is not in dispute that the refund claim was actually filed on 05.10.2017 which is beyond the period of six months contemplated under section 102 (1) of the Finance Act. In the instance case service tax was liable to be paid at the relevant time and it is only subsequently that by a retrospective amendment, exemption was granted with a specific condition that refund could be claimed by filing it within six months from the date of enactment of the Finance Bill 2016. The refund claim had, therefore, to be filed within six month from 14.05.2016, but it was filed beyond the said period. The contention of the learned counsel for the appellant that since the limitation period of one year contemplated under section 11B of the Central Excise Act 1944 provides for filing of the claim within one year from the date of payment of tax, the refund claim filed by the appellant should be treated to have been filed within time as it was filed within one year cannot also be accepted for the reason that section 102 (1) of the Finance Act itself provides for a limitation period of six months for filing a refund claim - Once the refund claim is held to be barred by time, the question of unjust enrichment would not arise. This appeal is, accordingly, dismissed.

Summary

Issues:
1. Refund claim filed beyond the stipulated period under section 102 (1) of the Finance Act.
2. Applicability of unjust enrichment in the case.

Analysis:
1. The appellant, a construction firm, filed a refund claim challenging the rejection by the Assistant Commissioner based on limitation, unjust enrichment, and violation of Finance Act provisions. The claim pertained to service tax paid from 01.04.2015 to 29.02.2016, following a retrospective exemption introduced by Finance Bill 2016. The claim was filed on 05.10.2017, beyond the stipulated six-month period from the enactment of the Finance Bill, as required by section 102 (1) of the Finance Act. The Commissioner (Appeals) upheld the rejection on grounds of limitation and unjust enrichment, emphasizing the late filing of the claim.

2. The appellant argued that since the service tax was mistakenly collected due to the retrospective exemption, the limitation period under section 11B of the Central Excise Act 1944 should apply, allowing the claim filed within one year to be considered timely. However, the Tribunal held that section 102 (1) of the Finance Act explicitly mandated a six-month limitation for filing refund claims under the retrospective exemption. Therefore, the claim filed on 05.10.2017 was beyond the statutory deadline, rendering the issue of unjust enrichment moot.

3. The Tribunal rejected the appellant's reliance on precedents where service tax was mistakenly paid despite exemptions. In the present case, service tax was legitimately due at the time, and the subsequent retrospective amendment allowed for a refund within a specific timeframe. As the appellant failed to meet the statutory deadline for filing the refund claim, the issue of unjust enrichment did not require consideration. Consequently, the Commissioner (Appeals) was justified in dismissing the appeal, leading to the final dismissal of the appellant's claim on 17.08.2022.