2010 (2) TMI 134 - AT - Service Tax

Refund of service tax paid wrongly - The issue involved in this case is whether the appellants can file the refund claim without challenging the assessment in the facts and circumstances of the case. department contended that it is a case of self assessment and the same has been accepted by the department, hence without challenging the same, the refund claim cannot be entertained and the lower authorities have rightly followed the Flock (India) Ltd. decision and the impugned order is sustainable. Held that it is a case where the appellants have paid Service Tax on their own and on finding that they are not liable to pay the Service Tax, they filed a refund claim. There was neither assessment made by the Central Excise officer, nor any decision taken by the Central Excise officer and nothing is available on record. Hence, the question of challenging the assessment does not arise at all. - proposition that assessment includes self assessment is not correct - the appellants cannot file any appeal against their own assessment decided in favor of assessee.

Summary

Issues involved:
Whether the appellants can file a refund claim without challenging the assessment?

Analysis:
The case involves the appellants providing Business Auxiliary service to a company and paying service tax on commission received before a policy change. Post-policy change, they filed a refund claim, rejected by lower authorities citing the decision in CCE, Kanpur Vs. Flock (India) Pvt. Ltd. The main issue is whether the appellants can file a refund claim without challenging the assessment. The appellant's advocate argued that as no order was passed by an adjudicating authority, they were not required to file an appeal. She distinguished cases like Flock (India) Ltd. and Priya Blue Industries Ltd. where assessments/orders were challenged before filing refund claims. The advocate cited precedents like Central Office Mewar Palace Org. Vs. Union of India to support the argument that without an appealable order, a refund claim can be filed. On the contrary, the Departmental Representative contended that since the self-assessment was accepted without challenge, the refund claim was not maintainable, aligning with the Flock (India) Ltd. decision.

The Member (Judicial) analyzed the case, emphasizing that no order or decision by the Central Excise officer was challenged, making the question of challenging the assessment irrelevant. The Member noted that the appellants paid service tax on their own assessment and filed a refund claim upon realizing their non-liability. Citing Nagpur Transwell Power Pvt. Ltd. case, the Member clarified that the appeal under Section 35F of the Central Excise Act is against orders/decisions by subordinate officers, not self-assessment. Precedents like M/s Gimatex Industries Pvt. Ltd. were referenced to support the view that the law does not provide for an appeal against self-assessment. Ultimately, the Member concluded that as there was no order or decision to challenge, the appellants were not entitled to file an appeal against their own assessment. Consequently, the impugned order was set aside, and the appeal by the appellants was allowed.