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2024 (5) TMI 369 - CESTAT NEW DELHIRefund of Service tax paid - time limitation - application rejected as not filed within one year from the payment of the service tax as laid down in section 11B of CEA - HELD THAT:- The nature of assessment and refunds were examined by the Supreme Court in Priya Blue Industries vs Commissioner of Customs (Prev) [2004 (9) TMI 105 - SUPREME COURT] which was a Customs case and Collector of Central Excise vs Flock (India) Pvt. Ltd. [2000 (8) TMI 88 - SUPREME COURT] which was a central excise case. In both judgments, the Supreme Court held that refund can only be sanctioned in pursuance of the assessment not such as to have the effect of changing the assessment. After these judgments, there have been changes in the law and self-assessments were introduced. The question which arose is if there was only self-assessment and no re- assessment by the officer, if the refund could be sanctioned contrary to the self assessment. This was answered by a larger bench of Supreme Court in negative in ITC Ltd. vs Commissioner of Central Excise, Kolkata IV [2019 (9) TMI 802 - SUPREME COURT]. It has been held that all assessments, including self-assessments are appealable and unless the assessment is modified, no refund could be sanctioned so as to change the assessment. The reason for this is the refund proceedings are in the nature of execution proceedings and they cannot be used to re-determine the liabilities - Thus, it was held that through refund proceedings, the assessment (including self-assessment) cannot be modified. Through ITC Ltd., a batch of matters were disposed of. The discussion in this judgment was largely based on the provisions of Customs Act but the principle laid down was clear that refund proceedings are only in the nature of execution proceedings and cannot change the assessment. The legal position is loud and clear. Refund proceedings are in the nature of execution proceedings and they cannot modify an assessment including self-assessment. Refund can only be sanctioned or denied as per the assessment- be it self-assessment by the assessee or the best judgment assessment by the officer. This legal position will not and cannot vary depending on which side it favours. The law laid down in ITC Ltd. and BT (India) Pvt. Ltd. applies whether the claimant will get refund as a result or will be denied refund as a result. In neither case can the refund, which is in the nature of an execution proceeding be used to alter the assessment. Thus, the order of the Larger bench of this Tribunal in Balaji Warehouse interpreting the applicability of ITC Ltd. to service tax matters relied upon by the appellant has been clearly overturned by the High Court of Delhi in BT (India) Pvt. Ltd. Clearly, ITC Ltd. applies to service tax matters also. Since the appellant had self-assessed service tax without applying the notification and the assessment has not been modified, it cannot be modified now in the refund proceedings. As per the self-assessment, the appellant was not entitled to the refund. The impugned order is upheld - appeal dismissed.
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