2011 (5) TMI 692 - AT - Service Tax

Refund claim - amounts of service tax were paid under the head Clearing & Forwarding Agency Services - rejection of claim on the grounds of limitation and unjust enrichment under Section 11B of the Central Excise Act read with Section 83 of the Finance Act, 1994 - There is no reference to the relevant period in Chartered Accountant certificate - document appears to indicate that the amounts of service tax mentioned therein are outstanding in the books of accounts of the appellant as on 31/03/2011 - no cogent explanation forthcoming about any of these infirmities of this document - refund of service tax cannot be allowed without the bar of unjust enrichment - appeal is dismissed. Proof of service tax paid under protest - held that - This document contains a handwritten footnote reading thus the same paid under protest as per letter of Directorate of Service Tax dated 05/02/2002 . As already indicated, this document is a zerox copy of the TR-6 challan for January 2002. In the absence of the original TR-6 challan, it is difficult for us to accept the claim that the above remark had been made in the original TR-6 challan. This is because manipulation is possible in the course of photocopying a document. In any case, the appellant or their Consultant has not brought on record any other documents evidencing payment of service tax under protest for the remaining period. In the circumstances, the present contention of the appellant that the service tax paid under protest cannot be accepted.

Summary

Issues:
1. Rejection of two refund claims for service tax under 'Clearing & Forwarding Agency Services'.
2. Contention regarding the nature of transactions and liability to pay service tax.
3. Bar of unjust enrichment.
4. Limitation period for refund claims.
5. Evidence of payment of service tax under protest.
6. Challenge against findings of lower authorities.
7. Nexus between service tax amounts and refund claims.

Analysis:

1. The appeal was against the rejection of two refund claims for service tax amounts paid under 'Clearing & Forwarding Agency Services'. The department issued show-cause notices proposing to reject the claims on grounds of limitation and unjust enrichment. The Assistant Commissioner rejected the refund claims citing time-bar under Section 11B of the Central Excise Act and unjust enrichment. The Commissioner (Appeals) upheld this decision, leading to the current appeal.

2. The appellant argued that the transactions with oil marketing companies were on a principal-to-principal basis, not as agents. They claimed that service tax payments were made 'under protest' from January 2002. However, the lower authorities found that the service tax had been collected from clients, leading to the rejection of the refund claims. The Tribunal held that the appellant's liability to pay service tax as a Clearing & Forwarding Agent was established during the disputed period.

3. The appellant raised the bar of unjust enrichment, claiming that the service tax burden was not passed on to customers. However, the Assistant Commissioner found that the service tax amounts were recovered from clients. The Tribunal noted the lack of evidence or challenge against this finding, leading to the rejection of the unjust enrichment plea.

4. The issue of limitation arose regarding the refund claim for a specific period. The authorities found the claim time-barred under Section 11B. The appellant's argument of payment under protest lacked substantial evidence. The Tribunal upheld the decision on the grounds of time-bar.

5. The absence of concrete evidence of payment of service tax under protest for the disputed period weakened the appellant's case. The Tribunal emphasized the importance of providing clear documentation to support such claims.

6. The appellant failed to challenge the findings of the lower authorities effectively. The lack of evidence or submissions against the decisions made by the Assistant Commissioner and the Commissioner (Appeals) weakened the appellant's position in the appeal.

7. The appellant attempted to establish a nexus between certain service tax amounts and refund claims through a Chartered Accountant's certificate. However, the document lacked crucial details and relevance to the specific refund claims, leading the Tribunal to dismiss the appeal due to insufficient evidence and justification.

In conclusion, the Tribunal dismissed the appeal based on the established liability to pay service tax, time-bar limitations, lack of evidence of payment under protest, and failure to substantiate the claims against unjust enrichment.