2023 (8) TMI 1147 - AT - Service Tax

Refund of excess tax paid - barred by time limitation or not - orinciples of unjust enrichment - Section 11 B of the Central Excise Act, 1944 - HELD THAT - The order of this Tribunal in the case of PUJAN BUILDERS ENGINEERS CONTRACTORS VERSUS C.C.E. S.T. -VADODARA-II 2021 (2) TMI 512 - CESTAT AHMEDABAD finds mention in the show cause notice as well as the same was relied on by the appellant both before the Adjudicating Authority as well as before the Commissioner (Appeals), which have been passed in similar circumstances, where due to cancellation of some of the invoices, the amount of service tax relating to the cancelled invoices stood in excess, which was credited in TRANS-I under GST law and was reversed along with payment of interest, in view of an objection taken by the GST Department. The Authorities below have seriously erred in not even considering the law laid down by the Tribunal, which was specifically pointed by the appellant and is binding on them - the impugned order deserves to be set aside on this ground alone. The Adjudicating Authority had rejected the refund claim on the ground of unjust enrichment as well as on the ground that the appellant had not paid any excess amount of service tax for the reasons that the appellant had not produced any documentary evidence, in support thereof - Appeal allowed by way of remand.

Summary

Issues involved:
The issues involved in the judgment are the rejection of a refund claim on the grounds of being time-barred under Section 11 B of the Central Excise Act, 1944, unjust enrichment, and non-payment of excess service tax.

Refund claim time-barred under Section 11 B:
The appellant filed a refund claim of Rs.2,24,856 on 22.07.2021 for excess service tax payment during April to June 2017. The claim was rejected by the Commissioner (Appeals) as time-barred under Section 11 B, since the refund claim was made on 22.07.2021, after four years from the credit taken in GST TRAN-I on 27.12.2017. However, the Tribunal found that the refund claim was filed within the one-year limit under Section 11 B, considering the date of reversal of the excess amount on 24.11.2020. The Tribunal also noted that the Commissioner (Appeals) failed to consider the binding law laid down by the Tribunal and remanded the matter for further consideration on merits.

Unjust enrichment and non-payment of excess service tax:
The Adjudicating Authority rejected the refund claim on the grounds of unjust enrichment and non-payment of excess service tax, citing lack of documentary evidence. The Tribunal remanded the matter to the Commissioner (Appeals) for consideration on these issues, granting the appellant the opportunity to submit relevant documents to prove the excess payment of service tax due to invoice cancellations and to demonstrate that the duty incidence was not passed on to customers. The Tribunal set aside the impugned order and directed a reconsideration on merits, emphasizing the need for a thorough examination of the evidence presented by the appellant.

Conclusion:
The appeal was allowed by way of remand, with the Tribunal setting aside the Commissioner (Appeals) order and remanding the matter for a fresh decision on the issues of unjust enrichment and non-payment of excess service tax. The appellant was granted the liberty to submit all relevant documents and details to support their contentions. The Tribunal highlighted the importance of considering binding legal precedents and ensuring a comprehensive examination of all relevant aspects before making a final determination.