2019 (10) TMI 496 - AT - Service Tax

Refund of Service Tax - rejection of claim on the ground of time limitation - quarter July, 2016 to September, 2016 - N/N. 12/2013-ST, dated 01.07.2013 - HELD THAT - No SCN/deficiency memo was issued to the appellant stating reasons for rejecting the refund. The refund sanctioning authority in the first round of litigation has rejected the refund without stating any reasons. The Commissioner (Appeals) by order dated 23.03.2018, has remanded the matter directing the adjudicating authority to pass a speaking order and also to look into the report of the range officer - In such remand proceedings, the appellant was given a copy of the range officer s report. On perusal of the range officer report, it is categorically stated by the range officer that the refund claim dated 14.06.2017 is well within time. On reading of Condition No.(e) along with (f) of the notification, it can be seen that the assessee can file one claim for every quarter. The refund claim for invoices under dispute, has been filed on 14.06.2017, which is well within the time - Therefore, on appreciation of facts, the refund claim filed is well within time, and, therefore, the rejection of the same stating the ground of limitation is unjustified. Appeal allowed - decided in favor of appellant.

Summary

Issues: Refusal of service tax refund on the grounds of being time-barred.

Analysis:
1. The appellant, a SEZ Unit, sought a refund of service tax paid on specified services for the quarter July, 2016 to September, 2016, under Notification No.12/2013-ST. The refund was initially rejected without reasons, and upon appeal, the matter was remanded due to lack of explanation in the rejection order.

2. The appellant argued that the refund claim was within the time limit as per the notification's clauses, supported by the range officer's report confirming the timely filing of the claim. The authorities wrongly rejected the claim as time-barred without issuing a show-cause notice.

3. The Revenue's representative supported the rejection based on the date of invoices, asserting that the claim filed on 14.06.2017 was beyond the permissible time limit. However, the appellant contended that the invoices in question were within the relevant quarter.

4. The main issue revolved around the rejection of the refund claim as time-barred without providing a show-cause notice or proper reasoning. The Commissioner (Appeals) highlighted the lack of procedural fairness in the rejection process, emphasizing the need for a speaking order and adherence to principles of natural justice.

5. Upon review of the range officer's report and the notification's provisions, it was evident that the refund claim was filed within the stipulated time frame, allowing only one claim per quarter. Consequently, the rejection based on the ground of limitation was deemed unjustified, leading to the setting aside of the impugned order and allowing the appeal with any consequential reliefs.

This detailed analysis highlights the procedural irregularities, legal interpretations of the notification clauses, and the importance of adhering to principles of natural justice in tax refund matters, ultimately resulting in the favorable decision for the appellant.