2022 (2) TMI 139 - AT - Service Tax

Refund of service tax paid - appellant filed a refund claim of service tax paid inadvertently on 16.09.2020 - refund claim was rejected holding that refund claim is barred by limitation under Section 11B of the Act - HELD THAT - The facts which are not disputed by both the sides that a show cause notice dated 04.10.2018 was issued to the appellant to demand differential service tax on Renting of Immovable Property Service and it was held by the adjudicating authority that appellant is not required to pay service tax under the category of Renting of Immovable Property Service vide order dated 16.12.2019, thereafter, the appellant has filed refund claim on 16.09.2020. As the refund claim has been filed within one year from the date of the adjudication order wherein it has been held that the appellant is not required to pay service tax, therefore, in terms of Section 11B of the Act, refund claim is to be filed within one year, from the relevant date. The relevant date is the date of adjudication order date i.e 16.12.2019 - the refund claim filed by the appellant is within time. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund claim rejection on grounds of being time-barred under Section 11B of the Act.

Analysis:
The appellant appealed against the rejection of their refund claim for paying service tax under Renting of Immovable Property Service for residential purposes during 2014-2015 to 2016-2017. The adjudicating authority had issued a show cause notice in 2018 demanding differential service tax, which was later held that the appellant was not liable to pay service tax under this category and the notice was dropped in 2019. The appellant filed a refund claim in 2020, which was rejected as time-barred under Section 11B of the Act. The appellant argued that they were not required to pay service tax under this category for residential purposes and thus, Section 11B does not apply. The Authorized Representative contended that since the appellant voluntarily paid the tax, the refund claim is admissible under Section 11B, which allows filing within one year from the date of payment. Various decisions were cited to support both sides' arguments.

The Tribunal considered the submissions and noted that the show cause notice was issued in 2018, and the adjudication order in 2019 confirmed that the appellant was not liable to pay the service tax. The refund claim was filed in 2020, within one year of the adjudication order. Section 11B of the Act stipulates that a refund claim must be filed within one year from the relevant date, which, in this case, was the date of the adjudication order in 2019. Therefore, the Tribunal held that the refund claim was filed within the prescribed time limit as per Section 11B.

Consequently, the Tribunal found no merit in the impugned order rejecting the refund claim as time-barred. The order was set aside, and the appeal was allowed with consequential relief. The judgment emphasized that the refund claim was within time as per the provisions of Section 11B of the Act.