2019 (10) TMI 591 - AT - Service Tax

Refund of excess service tax paid - time limitation for claiming refund claim - appellant should have filed the claim for refund before one year from the relevant date i.e., from the date of payment of duty, which should have been before 05.10.2017 and 04.12.2017 and the assessee having filed the claim only on 15.05.2018 - HELD THAT - It is not the case that the tax or duty which has been held to be unconstitutional, or even void for that matter, has been claimed as refund. It is just that excess amount paid by the assessee and happily accepted by the Revenue without raising any objection, which is being sought by the appellant. Hon ble jurisdictional High Court in the case of M/S. 3E INFOTECH VERSUS CUSTOMS, EXCISE SERVICE TAX APPELLATE TRIBUNAL, COMMISSIONER OF CENTRAL EXCISE (APPEALS-I) 2018 (7) TMI 276 - MADRAS HIGH COURT squarely applies, wherein the Hon ble Court has even ordered for refund when the Service Tax itself was paid by mistake and that the claim for the same could never be barred by limitation. Appeal allowed - decided in favor of appellant.

Issues Involved:
1. Denial of refund claim for Service Tax paid in excess.
2. Application of the one-year time limit for refund claims.
3. Jurisdiction of authorities to entertain refund claims.
4. Applicability of precedents and legal provisions.

Detailed Analysis:

1. Denial of Refund Claim for Service Tax Paid in Excess:
The appellant's primary grievance is the denial of a refund claim amounting to ?11,32,500/- for Service Tax paid in excess. The refund claim was initially rejected by the Adjudicating Authority on the grounds of being time-barred, a decision upheld by the Commissioner of G.S.T. and Central Excise (Appeals-II), Chennai.

2. Application of the One-Year Time Limit for Refund Claims:
The Adjudicating Authority and the First Appellate Authority both held that the refund claim was filed beyond the one-year time limit prescribed under the relevant provisions. The appellant filed the refund claim on 15.05.2018, whereas it should have been filed before 05.10.2017 and 04.12.2017, making it liable for rejection due to the limitation of time.

3. Jurisdiction of Authorities to Entertain Refund Claims:
The Revenue argued, based on an order from the Hyderabad Bench of the Tribunal, that the authorities lacked jurisdiction to entertain the refund claim, suggesting that the appellant should approach a Civil Court. However, this argument was countered by the appellant citing the binding decision of the Hon’ble jurisdictional High Court in M/s. 3E Infotech, which mandated that such claims should not be barred by limitation when the tax was paid by mistake.

4. Applicability of Precedents and Legal Provisions:
The Tribunal analyzed the binding precedent from the Hon'ble jurisdictional High Court in M/s. 3E Infotech, which held that a refund claim for Service Tax paid by mistake could not be barred by limitation. The Tribunal also referred to the majority view in the Supreme Court's decision in Mafatlal Industries Ltd. v. Union of India, which emphasized that refund claims must be processed under Section 11B of the Central Excises and Salt Act, barring the jurisdiction of Civil Courts in such matters.

The Tribunal concluded that the authorities should not have accepted the payment if they were not willing to process the refund. It was noted that the Revenue's acceptance of the payment without objection implied that the same Act should apply to the refund process. The Tribunal found that the case did not involve a tax or duty deemed unconstitutional or void but merely an excess amount paid by the appellant.

Conclusion:
The Tribunal, adhering to the jurisdictional High Court's decision in M/s. 3E Infotech, held that the refund claim could not be barred by limitation if the Service Tax was paid by mistake. Consequently, the impugned order was set aside, and the appeal was allowed with consequential benefits as per law.

(Order pronounced in the open court on 15.10.2019)

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