2017 (10) TMI 808 - AT - Service Tax

Refund claim - Benefit of Notification 108/02/2009 dated 29.01.2009 - unjust enrichment - Held that - the appellants are not entitled to the benefit of exclusion provided under Notification 108/02/2009 dated 29.01.2009 - the appellants have failed to bring on record any document which shows that they have constructed the flats on their land. The refund claim is barred by unjust enrichment as the appellant has not been able to prove that the service tax has not been passed on to the ultimate buyer - appeal dismissed - decided against appellant.

Summary

Issues:
Appeal against rejection of refund claim for service tax on construction projects based on Circular 108/02/2009 ST dated 29.01.2009 and unjust enrichment.

Analysis:
The appellant, a registered service provider of Construction of Residential Complex and Works Contract Service, undertook construction projects and sold apartments to buyers. The appellant paid service tax as per Circular 108/02/2009 ST dated 29.01.2009. After the Circular, the appellant filed a refund claim which was rejected through an Order-in-Original dated 05.03.2010. The Commissioner (Appeals) upheld this rejection, leading to the present appeal.

The appellant argued that the impugned order failed to consider the law and evidence, claiming exemption under Circular 108/02/2009. The appellant contended that since the construction was on their land, no service tax was due. However, the AR argued against this, stating that the appellant did not provide proof of land ownership or exclusion eligibility under the Circular. The Commissioner (Appeals) also found issues with unjust enrichment, suggesting the tax may have been passed on to buyers.

The Tribunal found no fault in the impugned order, supporting the Commissioner's decision. The Tribunal noted the lack of evidence proving the appellant's ownership of the land where construction occurred, a crucial factor in claiming the Circular's benefits. The Commissioner's findings on unjust enrichment were also upheld, as the appellant failed to demonstrate that the service tax burden was not shifted to buyers. Consequently, the appeal was dismissed, affirming the rejection of the refund claim.

In conclusion, the Tribunal upheld the Commissioner's decision, emphasizing the importance of proving land ownership for Circular benefits and addressing unjust enrichment concerns. The appellant's failure to provide conclusive evidence led to the dismissal of the appeal, underscoring the necessity of meeting legal requirements for tax refunds in construction projects.