9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2024 (2) TMI 1511 - AT - Service TaxRefund of excess service tax paid by mistake - whether the refund claim should be denied based on procedural grounds such as the failure to include the refund in the returns filed by the appellant? - HELD THAT - This is a simple clerical error on the part of the appellant. While they were required to pay only Rs. 17, 855 for the consideration of Rs.1, 27, 535 received by them. By mistake they have added the consideration amount plus service tax and paid total service tax of Rs.145, 390. The lower authorities are not denying the fact that Rs.145, 390 has been paid by the appellant. The only ground taken by them to deny the refund claim is that this refund being claimed was not being shown as part of the Returns filed by the appellant. It is a clear case of mistake on the part of the appellant and they have paid excess service tax which should have been refunded to the appellant based on the documentary evidence like the challan and Invoice etc. Such an issue is covered by the decision of the The Punjab-Haryana High Court in the case of EXECUTIVE ENGINEER TRANSMISSION SYSTEM HARYANA VIDYUT PRASARAN NIGAM LIMITED VERSUS CENTRAL EXCISE SERVICE TAX APPELLATE TRIBUNAL CHANDIGARH AND ANOTHER. 2024 (8) TMI 1151 - PUNJAB AND HARYANA HIGH COURT which has held In the present case service tax has been paid twice and the service provider has claimed the said amount from the appellant company which cannot be passed on since the appellant company itself has deposited the amount with the state exchequers. It is a case of dual payment. The other party namely TDS Management has not moved any application for refund. In the circumstances the refund of the appellant-company cannot be denied solely on account of delay which has actually not occurred as it is from the date of knowledge. In the present case the appellant is in a much better footing. They have filed the refund claim in July 2015 for the excess Service Tax paid in June 2015 which is well within the time limit. Therefore applying the ratio laid down in the cited judgement of Punjab Haryana High Court the impugned order set aside and the appeal is allowed. Conclusion - The taxes collected erroneously should be refunded and procedural lapses should not defeat a legitimate refund claim. Appeal allowed.
ISSUES PRESENTED and CONSIDERED
The core legal issue considered in this judgment is whether the appellant is entitled to a refund of the excess service tax paid due to a clerical error. The Tribunal also examined whether the refund claim should be denied based on procedural grounds, such as the failure to include the refund in the returns filed by the appellant. ISSUE-WISE DETAILED ANALYSIS 1. Entitlement to Refund of Excess Service Tax Paid Relevant Legal Framework and Precedents: The legal framework revolves around Article 265 of the Constitution of India, which prohibits the collection of taxes without the authority of law. The Tribunal referenced a precedent from the Punjab-Haryana High Court, which held that taxes collected erroneously or illegally should be refunded. Court's Interpretation and Reasoning: The Tribunal recognized the appellant's situation as a simple clerical error, where the appellant paid service tax on both the consideration amount and the service tax itself, resulting in an overpayment. The Tribunal found that the lower authorities did not dispute the overpayment but denied the refund based on procedural grounds. Key Evidence and Findings: The appellant provided documentary evidence, such as challans and invoices, to support their claim of overpayment. The Tribunal accepted these documents as proof of the excess payment. Application of Law to Facts: The Tribunal applied the principles established in the cited Punjab-Haryana High Court case, which emphasized the illegality of retaining taxes collected erroneously. The Tribunal found that the appellant's refund claim was filed within a reasonable time frame and was supported by sufficient evidence. Treatment of Competing Arguments: The Tribunal considered the respondent's argument that the refund was not claimed in the returns filed by the appellant. However, the Tribunal dismissed this argument, emphasizing that the error was clerical and the refund claim was timely and substantiated. Conclusions: The Tribunal concluded that the appellant is entitled to a refund of the excess service tax paid, along with interest. The Tribunal ordered that the refund be processed within two months, with interest calculated from three months after the filing of the refund claim. SIGNIFICANT HOLDINGS Preserve Verbatim Quotes of Crucial Legal Reasoning: The Tribunal quoted the Punjab-Haryana High Court's decision, stating, "Article 265 of the Constitution of India prevents the authorities from collecting tax illegally. In other words, any amount which has been deposited with the State under a head can only be allowed to be retained if the same is deposited legally and not erroneously, illegally or without knowledge." Core Principles Established: The judgment reinforces the principle that taxes collected erroneously should be refunded, and procedural lapses should not defeat a legitimate refund claim. The Tribunal emphasized the importance of timely filing and adequate documentation in supporting refund claims. Final Determinations on Each Issue: The Tribunal set aside the lower authorities' decision and allowed the appeal. The appellant was granted a refund of the excess service tax paid, along with interest. The Tribunal directed that the refund and interest be paid within two months from the date of receipt of the order.
|
