2018 (11) TMI 89 - AT - Service Tax

Refund of service tax credit - N/N. 41/2012 ST dated 29.06.2012 - only point of contention is that the Assistant Commissioner has not discharged his duty in properly recording his satisfaction of fulfillment of conditions of the notification while sanctioning the refund - Held that - There is no allegation that the appellant has not fulfilled the conditions mentioned in the notification. In view of this unusual factual matrix in which one of the conditions of the notification was not fulfilled by the Assistant Commissioner (and not by the assessee), this is a fit case remanded back to the Original Authority to satisfy himself and record his satisfaction regarding the fulfillment of the notification and sanction refund to the extent admissible - appeal allowed by way of remand.

Summary

Issues:
Appeal against Order-in-Appeal setting aside Orders-in-Original for refund claims under Notification No. 41/2012 - ST due to Assistant Commissioner not recording satisfaction as required.

Analysis:
1. Issue of Compliance with Notification Requirements:
The appellant filed refund claims under Notification No. 41/2012 - ST seeking service tax credit refund. The Assistant Commissioner passed Orders-in-Original sanctioning the refunds without recording satisfaction as required by para 3(k) of the notification. The Revenue contended that this non-compliance led to a violation of the notification, prompting the First Appellate Authority to set aside the Orders-in-Original. The Authority found that the Assistant Commissioner had failed to fulfill the duty of satisfying himself that the conditions mentioned in para 3(k) were met before sanctioning the refunds.

2. Arguments and Counterarguments:
The appellant's Chartered Accountant argued that all conditions laid down in the notification were fulfilled, and the range officers verified the documents before the refunds were sanctioned. He contended that the onus of recording satisfaction lay with the Assistant Commissioner, not the appellant. On the other hand, the Departmental Representative reiterated that para 3(k) mandatorily required the Assistant Commissioner to ensure compliance before sanctioning refunds, which was not done in this case.

3. Judgment and Remand:
The Tribunal considered both sides' arguments and noted that while the Assistant Commissioner did not fulfill his duty of recording satisfaction, there was no allegation that the appellant had not met the notification conditions. In a unique scenario where the Assistant Commissioner's obligation was not fulfilled, the Tribunal decided to remand the matter back to the Original Authority. The appeal was allowed by remanding the case to the Original Authority for proper satisfaction and decision on the refund claims as per the notification requirements.

4. Modification of Impugned Order:
The Tribunal modified the impugned order to remand the case to the Original Authority for recording satisfaction and deciding on the refund claims, emphasizing the need for compliance with para 3(k) of Notification No. 41/2012 - ST. The judgment focused on ensuring proper fulfillment of notification conditions by the Assistant Commissioner before sanctioning refunds, highlighting the procedural importance of compliance in such cases.