2018 (1) TMI 4 - AT - Service Tax

Refund claim - taxes having been paid on certain services provided by it which were not taxable service - time limitation - When the order of the appellate Commissioner is read, it demonstrates that he has only examined the question of admissibility of refund of tax without examining the law relating to levy of service tax? - appellant says that larger Bench of this Tribunal has already decided the issue by its order dated 17.10.2016 in the case of Commissioner of Central Excise & Service Tax-III Vs. State Bank of Patiala 2016 (10) TMI 800 - CESTAT NEW DELHI - Held that - It may be stated that while deciding the question referred to the larger Bench, at no stage, pendency of the matter before the Apex Court has been taken into account. When the very scope and ambit of N/N. 22/2006-ST is under sub-judice before the Apex Court, it is premature on the part of the Tribunal to overreach the jurisdiction of the Apex Court - both the matters remanded to the learned adjudicating authority - appeal allowed by way of remand.

Summary

Issues:
1. Whether taxes paid on certain services by the assessee, which were claimed as non-taxable, should be refunded.
2. Whether services provided by the appellant bank are taxable or exempt from Service Tax.
3. Whether the appellate Commissioner properly examined the admissibility of tax refund.
4. Whether the issue of levy of service tax is pending before the Apex Court.
5. Whether the Tribunal can decide on the matter when the scope of Notification No.22/2006-ST is under sub-judice before the Apex Court.

Analysis:
1. The appellant raised the issue of refund for taxes paid on services claimed as non-taxable. The Revenue denied the refund, arguing that the services provided were taxable. The adjudicating authority rejected the appellant's plea based on the scope of relevant notifications. The appellant contended that since the services were not taxable, a refund should be granted.

2. The appellant bank argued that services like disbursing pensions and making payments on behalf of the government should be exempt from Service Tax. However, the adjudicating authority held that these services were taxable, leading to the denial of exemption and refund. The appellant challenged this decision, emphasizing the non-taxable nature of the services provided.

3. The appellate Commissioner focused on the admissibility of tax refund without delving into the law regarding the levy of service tax. The Revenue pointed out that the issue of levy was under consideration by the Apex Court in previous cases, suggesting that no refund should be granted.

4. The Tribunal noted that the issue of levy of service tax was pending before the Apex Court in certain cases involving banks. The appellant cited a previous decision by a Larger Bench of the Tribunal to support their argument for refund, contrary to the Revenue's stance based on pending cases before the Apex Court.

5. Considering the pending cases before the Apex Court and the jurisdictional limitations, the Tribunal decided to remand both appeals back to the adjudicating authority. The Tribunal emphasized the need to await the outcomes of the cases before making a decision on the refund claims, ensuring a fair process based on the legal developments in the relevant cases.