2017 (3) TMI 379 - AT - Service Tax

Refund claim - purchase of flats from builder - whether the appellants who are purchasers of an apartment/flat/residence from a builder or a developer is entitled to claim refund of service tax paid by him to the builder on the ground that service tax was not taxable before 1.7.2010? Held that - As long as the document shows that the service provider is a registered person, his registration number is available and details of service tax paid and the certificate by the developer that he has paid the service tax and statement showing the value of service tax are provided, in our opinion, would be sufficient. Reliance placed in the case of JOSH P JOHN AND OTHERS Versus CST, BANGALORE AND OTHERS 2014 (9) TMI 597 - CESTAT BANGALORE , where it was held that prior to 01.07.2010 the service in dispute in these cases was not taxable. Transactions where individuals have entered into agreements for purchase of flats/residences with the builder/developers, in our opinion, is not covered by the definition. Matter remanded back to the original authority who will decide the refund claim - appeal allowed by way of remand.

Summary

Issues Involved:
Appeals against impugned order upholding Orders-in-Original for refund of service tax paid by purchasers of apartments from builders.

Analysis:
The present case involves ten appeals filed by individuals against an order by the Commissioner (A) upholding the Orders-in-Original regarding the refund of service tax paid to builders. The appellants purchased flats and applied for refunds, which were rejected citing inapplicability of a specific Board Circular. The main issue is whether purchasers can claim a refund of service tax paid to builders pre-1.7.2010. The consultant argued that the builder collected and remitted the service tax, supported by bills, receipts, and certificates. The Tribunal noted previous remands and Final Orders, emphasizing the need for evidence that the service tax liability was borne by the claimant. The Tribunal clarified that the presence of specific documents, including the service provider's registration details, tax payment proof, and a certificate from the builder, is sufficient to support the refund claim.

The Tribunal referred to previous Final Orders and outlined the criteria for refund claims, emphasizing the importance of evidence showing the claimant's service tax liability. It directed the original authority to decide the refund claims afresh, following the guidelines provided. The Tribunal instructed the appellants to submit any required documents within three months and highlighted the necessity for the original adjudicating authority to inform appellants of any additional requirements before rejecting refund claims. The Tribunal stressed the payment of interest as per the law on sanctioned refunds and the need for adherence to principles of natural justice in the adjudication process. Ultimately, the appeals were allowed by way of remand for further proceedings by the original authority.

In conclusion, the Tribunal's judgment focused on the evidentiary requirements for refund claims of service tax paid by purchasers to builders, emphasizing the need for specific documents to support such claims. The decision highlighted the importance of procedural fairness, adherence to legal principles, and the payment of interest on sanctioned refunds. The case was remanded for a fresh decision by the original authority, ensuring compliance with the Tribunal's guidelines and directives.