2024 (5) TMI 418 - HC - Service Tax

Effect of Explanation under Section 65(105) of the Finance Act, 1994, introduced by the Finance Act, 2005 and the provisions of Rule 2(1)(d)(iv) of the Service Tax Rules, 1994 - prospective or retrospective effect - refund of tax paid pursuant to the said amendment - respondents submits that the petitioner would not be entitled to the refund - HELD THAT - The petitioner may agitate the same before the authority concerned. As various aspects will have to be considered while entertaining the prayer for refund, the petitioner may apply to the authority concerned. Upon an application being made by the petitioner, the authority concerned shall take decision upon it on its own merits, preferably within six months from the date of receipt of the application. The writ petition is disposed of.

Summary

Issues involved: Challenge to Explanation u/s 65(105) of Finance Act, 1994 and Rule 2(1)(d)(iv) of Service Tax Rules, 1994 as ultra vires.

Explanation u/s 65(105) of Finance Act, 1994 and Rule 2(1)(d)(iv) of Service Tax Rules, 1994:
The petitioner challenged the Explanation u/s 65(105) of the Finance Act, 1994, introduced by the Finance Act, 2005, and provisions of Rule 2(1)(d)(iv) of the Service Tax Rules, 1994 as ultra vires. Both parties agreed that the amendment, being prospective, would not apply before 18.04.2006, citing the judgment in Commissioner of Service Tax v. Sojitz Corporation [2022 (65) G.S.T.L. 130 (S.C.)]. The petitioner sought a refund of tax paid prior to 18.04.2006, which was contested by the respondents. The court directed the petitioner to apply to the concerned authority for the refund, with a decision to be made within six months. The respondents were barred from recovering any amount prior to 18.04.2006. The writ petition was disposed of without costs.