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TMI Blog2009 (10) TMI 36X X X X Extracts X X X X X X X X Extracts X X X X ..... ned counsel appearing for the respondent. 3. The petitioner is a firm rendering architectural services and holding a registration certificate No.Arch/Chennai-II/40/STC. The petitioner received payment from a client in Sri Lanka on 27.5.2005 in US Dollars and the petitioner paid a sum of Rs.8,67,800/- on 4.7.2005 towards service tax. But after realising that the services rendered for the construction of a building in Sri Lanka, would not attract service tax, the petitioner made a claim for refund on 20.9.2006. 4. The respondent issued a show cause notice dated 5.10.2006 and after receiving a reply from the petitioner, the respondent issued an Order-in-Original dated 23.5.2007, rejecting the claim as time barred and also on the ground that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant date for the commencement of the period of limitation, for the purpose of Section 11B, would be the date of payment of duty. 7. Unfortunately, the date of payment, in this case, was admittedly 4.7.2005. The date on which a claim for refund was made, was 20.9.2006, which was obviously beyond the period of limitation. Therefore, at the outset, the rejection of the claim appears to be in tune with the statutory provisions. 8. However, Ms.Pushya Sitaraman, learned counsel for the petitioner relied upon the decision of the Supreme Court in Union of India vs. ITC Ltd {1993 (67) ELT 3 (SC)} and the decision of a Division Bench of this Court in C.C.E. Madras vs. Indo-Swiss Synthetic Gem Manufacturing Co. Ltd {2003 (162) ELT 121} and contend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) SCC 636}, a question arose as to whether the payment of cess made under a mistake of law, can be recovered beyond the period stipulated. Though the Supreme Court ultimately rejected the claim for refund on the ground of delay and laches, the Court made certain observations in paragraphs-7 and 8 of the judgment which read as follows:- "7. Section 17(1)(c) of the Limitation Act, 1963, provides that in the case of a suit for relief on the ground of mistake, the period of limitation does not begin to run until the plaintiff has discovered the mistake or could, with reasonable diligence, have discovered it. In a case where payment is made under a mistake of law as contrasted with a mistake of fact, generally the mistake becomes known to the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 72 of the Contract Act. 13. In Union of India vs. ITC Ltd {1993 Supp. (4) SCC 326}, the Supreme Court upheld the view taken by the Division Bench of the Delhi High Court with regard to the question of limitation. On the question of limitation, the Division Bench of the Delhi High Court had observed that "the duty of excise is that which is levied in accordance with law" and that "any money which is realised in excess of what is permissible in law would be a realisation made outside the provisions of the Act". 14. Therefore, it is clear that if what was paid cannot be taken to be duty of excise, the bar of limitation under Section 11B (1) cannot be applied. This is on account of the fact that the bar of limitation prescribed und ..... X X X X Extracts X X X X X X X X Extracts X X X X
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