2013 (4) TMI 554 - AT - Service Tax

Refund claim for excess Service Tax paid on being pointed out by the Audit party - rejection of claim on the principle of unjust enrichment and credited to the Consumer Welfare Fund - FAA rejected Chartered Accountant s certificate indicating it not disclosing accounting practices whatsoever and that the said certificate is based on the accounts - Held that - Findings of the FAA are far from reality, in as much as it can be seen from the Chartered Accountant s certificate that it has categorically certified that he has verified the books of accounts like Cash/Bank Book and Ledger Accounts and on verification, he has certified that the amount has not been passed on by the appellant to their clients. See Crane Betel Nut Powder Works 2009 (6) TMI 530 - CESTAT, BANGALORE & Mangal Textile Mills Pvt.Ltd. (2002 (2) TMI 133 - HIGH COURT OF GUJARAT AT AHMEDABAD) wherein held that certificate of Chartered Accountant produced by the appellant was not disputed by the Revenue authorities, by bringing on record any other opinion contrary to the Chartered Accountant s certificate. In favour of assessee.

Summary

Issues involved:
Refund claim rejection based on unjust enrichment principle.

Analysis:
The case involves a dispute over a refund claim filed by the appellant after the first appellate authority reduced their tax liability. The appellant had paid an excess amount based on an audit party's findings. The first appellate authority rejected the refund claim citing that the appellant had booked the amount as expenses in their Profit & Loss Account, indicating indirect passing on of the duty/Service Tax liability to clients. However, the appellant's Chartered Accountant provided a certificate verifying that the amount was not recovered from clients. The first appellate authority's finding was challenged based on legal precedents, including the doctrine of unjust enrichment. The High Court's ruling in the case of Modi Oil & General Mills was cited to support the appellant's claim for refund after paying the directed amount. The Chartered Accountant's certificate was deemed crucial evidence in favor of the appellant, and the first appellate authority's dismissal of it was criticized. The judgment highlighted that the Revenue authorities did not present any conflicting opinion on the certificate, strengthening the appellant's position. Various case laws were referenced to support the appellant's argument against unjust enrichment. Ultimately, the judgment concluded that the first appellate authority's decision was unsustainable, setting it aside and allowing the appeal with consequential relief.