9911796707
TMI Blog2024 (3) TMI 182X X X X Extracts X X X X X X X X Extracts X X X X ..... orting inputs for manufacture of finished goods on which he was required to pay service tax, under reverse charge mechanism (RCM), on the services of transportation of goods provided by foreign shipping lines, in terms of Notification No 03/2017-ST dated 12.01.2017 read with Circular No 206/04/2017-ST dated 13.04.2017. 2.3 On being pointed appellant deposited an amount of Rs 6,53,724/- towards tax, interest of Rs 84,777/- and penalty of Rs 98,059/- vide Challan No 037 dated 11.01.2018. 2.4 Appellant filed the refund claim for an amount of Rs 6,53,724/- claiming benefit of Notification No 10/2017-CE (NT) dated 13.04.2017. A show cause notice dated 29.06.2018 was issued to the appellant stating as follows: "As per para 3 of Circular No 206/4/2017-ST dated 13.04.2017, "Clarification has also been sought with regards to calculation of service tax regarding service of transportation of goods by sea provided by a foreign shipping line. In case of service of transportation of goods by sea provided by a foreign shipping line to foreign charterer w.r.t goods destined for India, an option has been provided in the service tax rules to pay service tax @ 1.4 of the value of imported goods a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... les, 2004, however both the original authority as well as Commissioner (Appeal) did not deal with the issue as under the said rule credit of only input and capital goods was denied and not the credit of input service. Both the authorities decided the issue by travelling beyond the issue raised in the notice which is not permissible under law. Reliance placed on * Tirupati Pipe & Allied Industries (P) Ltd [2008 (227) ELT 147 (T)] * Tilrode Chemicals (P) Ltd [2011 (264) ELT 306 (T) affirmed by Hon'ble High Court of Karnataka as reported at [2015 (317) ELT A-190 (Kar)] * The SCN was not maintainable as Rule 9(1)(b) of Cenvat Credit Rules as restriction on credit of tax paid is limited on input tax credit and credit of capital goods alone if paid by reason of fraud, collusion or any wilful misstatement or suppression of facts or contravention of any provisions of the Excise Act, or of the Customs Act, 1962 (52 of 1962) or the rules made there under with intent to evade payment of duty whereas in the present case amount paid relate to input service which was not barred and the above allegations were never leveled against the Appellant. 3.3 Arguing for the revenue learned authoriz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the refund of tax paid which the appellant was required to pay as per law. In the case of WILLOWOOD CHEMICALS PVT. LTD. Versus UNION OF INDIA [2018 (19) G.S.T.L. 228 (Gujarat)] in which the Hon'ble High Court held that:- "In the present case, we have noted the statutory provisions, the scale of operations and the possible repercussions; if such time limit contained in Rule 117 is annihilated and a registered person is allowed to make declarations of the left over residuary duty of credit at the time of migration to the new tax structure. The time limit provisions, we have already stated more than once, under such circumstances, cannot be seen as merely technical in nature.' [Para 40]". 5.1. I find that both the appellant as well as the adjudicating authority have misconstrued the issue in question and have based their arguments and findings whether or not the CENVAT Credit of the tax paid by the appellant, under RCM, was admissible, though the issue of eligibility or otherwise of the CENVAT Credit of the tax paid was not before the adjudicating authority. Similarly, it was not the case of the appellant that he had paid the service tax which was not payable. He has s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... way of transportation of goods by a vessel from a place outside India up to the customs station of clearance in India where service tax is paid by the manufacturer or the provider of output service being importer of goods as the person liable for paying service tax for the said taxable services, credit of service tax paid by the person liable fo paying service tax shall be allowed after such service tax is paid". As per clarification given in first Para of CBEC Circular No.206/4/2017-Service Tax dated 13.04.2017 which reads as "Your kind attention is invited to notification No. 1/2017-S.T., dated 12th January, 2017, whereby service tax exemption was withdrawn for services provided by a person located in non-taxable territory to a person located in non-taxable territory by way of transportation of goods by a vessel from a place outside India up to the customs station of clearance in India. Further, in relation to such services, the person in India who complies with sections 29, 30 or 38 read with section 148 of the Customs Act, 1962 (52 of 1962) with respect to such goods, was notified as the person liable to pay service tax vide notification No. 2/2017 and 3/2017-S.T. both dated 12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entral Excise Rules,2002 from his factory or depot from the premises of the consignment agent of the said manufacture or. importer or from any other premise from where the good are sold by or on behalf of the said manufacturer or importer in case additional amount of Excise duties or additional duties leviable under section 3 of Customs Tariff Act, has been paid, except where the additional amount of duty became recoverable from the manufacturer or importer of input of capital goods on account of duty of any non levy or short levy by reason of fraud collusion or any wilful misstatement or suppression of the fact or contravention of any provisions of the Excise Act or of Customs Act 1962(52 of 1962) or the Rule made there under with intent to evade payment of duty and that the charge that the duty has been non levied or short levied by treason of fraud, collusion or any wilful mis-statement or suppression of the fact or contravention of any provision of the Excise act or of Customs Act , or the Rules made there under with intent to evade payment of duty has not been made in the F. A. R No. 71/ST/2017- 18 issued vide letter C. No. V(1)audit/ Circle-3/Group-2/Swati/91/2017/422 dated 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 11B(3) of the Central Excise ACT, 1944. Hence the question of refund of the same does not arise." 4.4 From the perusal of the refund application filed by the appellant is reproduced below: 4.5 From perusal of the above application it is evident that appellant has claimed that CENVAT credit of the amount of service tax deposited by him i.e. Rs 6,53,724/- as per the audit conducted at their factory is admissible to him as CENVAT credit as per Notification No 10/2017-CE (NT) dated 13.04.2017. As he has deposited the said amount by Challan dated 11.01.2018 after introduction of the Good and Service Tax Law with effect from 01.07.2017, he is not in position to claim the credit of the said amount, he should be allowed the refund of the said amount in cash as per section 142 (8) (b) of the Central Goods and Service Tax Act, 2017. No other ground has been stated by the appellant in the application made by the appellant. 4.6 By the show cause notice dated 29.06.2018, appellant's claim to the CENVAT Credit has been challenged and thus he has been asked to show cause why the refund claim filed by him should not be rejected. 4.7 Adjudicating authority has by his order in original, refe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able services under reverse charge mechanism as a recipient of "Goods Transport Agency Services". period 26.04.2017 to 29.04.2017 The dispute relates to the period 26.04.2017 to 29.04.2017 , when the petitioner imported 23000 MT of Coal from outside the territory of India through Haldia Port under Bill of Entry dated 27.04.2017 for using the same in or in relation to manufacture of their final product i.e. Sponge Iron. For the purposes of clearance/handing of the said coal from Haldia Port, the petitioner received bundle of services under "Port Services" from Kolkata Port Trust, Haldia. M/s Kolkata Port Trust raised their Bill dated 23.05.2017 for value of Rs. 89,36,836/- including service tax component amounting to Rs. 10,88,328/-. 23.05.2017 Though the said services were availed by the petitioner during the period 26.04.2017 to 29.04.2017 and payment of the same including service tax thereon was made by the petitioner to M/s Kolkata Port Trust during April, 2017, the bills for provision of services though raised on 23.05.2017 by M/s Kolkata Port Trust, however the bill in original was not received by them till 20.09.2017. 01.07.2017 The Central Excise Act, 1944 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Board of Direct Taxes and Customs. However, the petitioner did not claim the aforesaid service tax paid on "port services" in TRAN-1 although by this time the original bill was received as the said CENVAT Credit of the said transaction was not included in ER-1 return which was already filed. 28.06.2018 On 28.06.2018, the petitioner submitted its refund application in Form-R, praying for refund of the CENVAT Credit of Rs. 10,88,328/- being the service tax paid on "port services". 24.07.2018 The petitioner was served with a show-cause notice dated 24.07.2018 as to why the application for refund of CENVAT Credit of Input Service amounting to Rs. 10,88,328/- be not rejected. 13.09.2018 The petitioner filed its response to the show-cause notice vide letter dated 13.09.2018 and also attended personal hearing. 25.01.2019 03.02.2020 Impugned orders The respondent no. 3, by the impugned order in original dated 25.01.2019, rejected the application of the petitioner for refund. The said order dated 25.01.2019 was challenged before the appellate authority vide memo of appeal dated 25.03.2019. Thereafter, the respondent no. 2, by the impugned Order-in- Appeal dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f taxes is neither a fundamental right nor a constitutional right. The Constitution only guarantees that the levy should be legal and that the collection should be in accordance with law. There is no constitutional right to refund. Refund is always a matter of a statutory prescription and can be regulated by the statute subject to conditions and limitations; (iii) Even in the case of an illegal levy or a levy which is unconstitutional, the decision of the nine judges Bench in Mafatlal Industries Limited vs Union of India held that the right of refund is not automatic. The burden of proof lies on the claimant to establish that it would not cause unjust enrichment; (iv) Though tax enactments are subject to Articles 14 and 19(1)(g) of the Constitution, this is subject to two well-settled principles: (a) Discriminatory treatment under tax laws is not per se invalid. It is invalid only when equals are treated unequally or unequals are treated equally. Both under the Constitution and the CGST Act, goods, services, input (goods) and input services are not one and the same. These are distinct species, though covered by a common code; and (b) The legislature is entitled to the w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent to refund, it is open to the legislature to define the circumstances in which a refund can be claimed. The proviso to Section 54(3) is not a condition of eligibility (as the assessees' Counsel submitted) but a restriction which must govern the grant of refund under Section 54(3). We therefore, accept the submission which has been urged by Mr. N Venkataraman, learned ASG. 93. Parliament engrafted a provision for refund Section 54(3). In enacting such a provision, Parliament is entitled to make policy choices and adopt appropriate classifications, given the latitude which our constitutional jurisprudence allows it in matters involving tax legislation and to provide for exemptions, concessions and benefits on terms, as it considers appropriate. The consistent line of precedent of this Court emphasises certain basic precepts which govern both judicial review and judicial interpretation of tax legislation. These precepts are...... 94. The principles governing a benefit, by way of a refund of tax paid, may well be construed on an analogous frame with an exemption from the payment of tax or a reduction in liability [Assistant Commissioner of Commercial Tax (Asst.) vs Dharmend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 142(3) of CGST Act in the light of the facts and circumstances of this case. Legal proposition on the point of interpretation of transitional provisions, vested rights etc with reference to the judgements relied upon by the learned counsel of the petitioner. 10. The learned counsel for the petitioner has also referred to the judgment passed in the case of Union of India vs Filip Tiago De Gama of Vedam De Gama (supra) on the point that the transitional provisions are to be purposefully construed and the paramount object in statutory interpretation is to discover what the legislature intended and this intention is primarily to be ascertained from the text of the enactment in question. This principle of statutory interpretation is well settled. 11. So far as the case of K. S. Paripoornan (supra) is concerned, the Hon'ble Supreme Court has considered the role of "Transitional Provision" and the learned counsel for the petitioner has referred to Para-71 of the said judgment, which is quoted as under: - "71. Section 30 of the amending Act bears the heading "Transitional provisions". Explaining the role of transitional provisions in a statute, Bennion has stated: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the general provision applies only to such cases which are not covered by the specific provision, we must hold that Cl. 5(a) has no application in a case where the special provisions of Cl. 23 are applicable." The aforesaid judgment does not help the petitioner in any manner in view of the fact that there is no conflict amongst the various provisions of CGST Act referred to by the learned counsel for the petitioner during the course of argument, particularly with reference to Sections 140, 142 and 174 of the CGST Act. The provisions have been interpreted in later portion of this judgement. 14. The learned counsel has further referred to the judgment in the case of CIT vs J. H. Gotla reported in (1985) 4 SCC 343 = 2002-TIOL-131-SC-IT-LB to submit that even in taxation, if strict literal construction leads to absurdity, construction which results in equity rather than injustice, should be preferred. However, during the course of argument, the learned counsel has failed to demonstrate as to how any of the provisions of CGST Act which have been referred to by the petitioner has led to any absurdity. The interpretation of the provisions of CGST Act particularly with reference to re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ght, it does so with prospective effect when it comes into force, unless expressly stated otherwise." 17. In the case of Glaxo Smith Kline PLC and Others (supra), the Hon'ble Supreme Court has upheld the view of the learned single judge of the High Court and held at Para-17 as under: - "17. The learned Single Judge's view that the provisions of Section 78 of the Amendment Act have no application to the proceedings which stood concluded before the appointed day appears to be the correct view governing the issue. Since Chapter IV-A in question was merely repealed, the situation has to be dealt with in line with Section 6 of the General Clauses Act. The provisions of Section 78 are conditional provisions and are not intended to cover cases where the application for EMR had been rejected with reference to Section 21 of the amending enactment. As noted above, Chapter IV-A was repealed. The effect of the repeal has to be ascertained in the background of Section 6 of the General Clauses Act. That being so, the order of the Division Bench cannot be sustained and that of the learned Single Judge has to operate. The appeal is allowed but in the circumstances without any order as t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may look at the matter from another angle. If on the inputs, the assessee had already paid the taxes on the basis that when the goods are utilised in the manufacture of further products as inputs thereto then the tax on these goods gets adjusted which are finished subsequently. Thus, a right accrued to the assessee on the date when they paid the tax on the raw materials or the inputs and that right would continue until the facility available thereto gets worked out or until those goods existed. Therefore, it becomes clear that Section 37 of the Act does not enable the authorities concerned to make a rule which is impugned herein and, therefore, we may have no hesitation to hold that the Rule cannot be applied to the goods manufactured prior to 16-3-1995 on which duty had been paid and credit facility thereto has been availed of for the purpose of manufacture of further goods." 19. The learned counsel has also referred to the judgment passed in the case of CCE vs Grasim Industries Ltd. (supra) to submit that excise duty/CENVAT is value added tax. There is no doubt about the aforesaid proposition, as it is not in dispute in the instant case that the petitioner was entitled to take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said judgement does not apply to the facts and circumstances of this case. The sequence of facts; case of the parties and the contents of the impugned orders 24. The petitioner was having Central Excise Registration for manufacture of sponge iron, billet and TMT Bar. The petitioner was also registered under Service tax only as a person liable to pay service tax under Reverse Charge Mechanism. Admittedly, the "port services" involved in this case is not covered under Reverse Charge Mechanism and therefore the same was not includable in the service tax return filed by the petitioner under ST-3. Accordingly, the petitioner was not entitled to avail credit of the impugned service tax paid on the "port services" in its service tax ST-3 return. 25. It is not in dispute that the petitioner was entitled to claim CENVAT Credit on the service tax paid on "port services" if used in the manufacturing activity for which the petitioner was registered under the Central Excise Act, 1944. 26. The petitioner had imported coal through Bill of entry dated 27.04.2017 for using the same in or in relation to manufacture of dutiable final products. In course of the import, they received a bun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly under reverse charge mechanism. Admittedly, "port services" were not under reverse charge mechanism. 29. Further, Rule 5 of CENVAT Credit Rules, 2004 permits refund only when the services are used to export goods or services, which is not the case in the present case. It is not the case of the petitioner that the impugned services were used for export of goods or services. Thus, under the existing law the claim of refund of service tax paid by the petitioner on port services was not admissible. 30. The case of the petitioner is that since they received the original copy of the Bill dated 23.05.2017 as late as on 20.09.2017, they could not take CENVAT Credit in their last ER-1 return for June, 2017 filed on 30.07.2017. However, the petitioner took the credit of Rs. 10,88,328/- in their ST-3 return for April-June, 2017 filed on 22.09.2017 with a view to keep the said transaction above board so that their claim was not lost. It is also not in dispute that the last date for filing TRAN-1 was extended up to 31.10.2017. 31. From the entire records of the case this court does not find any explanation from the side of the petitioner as to under what circumstances the Bill dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule 2(l) of CCR, 2004 and disclosure or non-disclosure of said credit in ST-3 and/or ER-1 are irrelevant. (iii) Ultimate eligibility of the credit of the impugned services is not in dispute and the benefit of CENVAT Credit eventually accrues to them which is the heart and soul of Section 142(3) of the CGST Act, 2017 and under Section 142(3) there is no statutory precondition that in order to claim the transitional credit, the claim must be disclosed in the ER-1 return; (iv) Section 142(3) of the CGST Act, 2017 provides for refund of CENVAT Credit in cash accruing to the assessee under CENVAT Credit Rules, 2004. Section 142 is a residuary provision which deals with cases/contingencies which are not specifically covered or contemplated under Section 140 or 141. Since, in the instant case the provision of Section 140(5) or any other sub-Section does not cover the contingencies as in the present case, it would be covered by the residuary provision of Section 142(3); (v) Section 142(3) specifically saves Section 11B(2)(c) of Central Excise Act which deals with refund of CENVAT Credit which remained un-utilized for one or another reason; (vi) Referring to the second proviso t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ol. They could not have filed any return thereafter when Central Excise Act, 1944 and the rules made thereunder was repealed; ii. They could not avail the benefit of Section 140(5) of the CGST Act, 2017 for the same reason that the original copy of the invoice was received in September, 2017. They were left with no option than to file refund Application vide their letter dated 29.06.2018 under residuary provision of Section 142(3) read with Section 174(2)(c) of the CGST Act and Section 11B(2)(c) of the Central Excise Act, 1944; iii. There is no requirement under Section 142(3) of the CGST Act of disclosure of the CENVAT Credit in the ER-1 return like Section 140(5) and unlike Section 140(1). 38. The appellate authority rejected the appeal with the following findings: a. The transitional provisions contained in Section 140 of the CGST Act, 2017 provide for carrying forward of closing balance of the amount lying in CENVAT Credit account as reflected in the statutory returns for the period immediately preceding the appointed day i.e. 01.07.2017. b. The Appellant could not carry forward the credit of Rs. 10,88,328/- of service tax, paid to Kolkata Port Trust for procureme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) Ltd. vs Commissioner of Central Excise, Jaipur-II - 2004 (172) E.L.T. 321 (Tri.- Del.) = 2004-TIOL-615-CESTAT-DEL, wherein it was held that there is no legal provision existing for refund either by cash or cheque. The only exception carved out is that the refund in cash is granted as an incentive measure to the exporter. The provisions and particularly Section 11B of the Central Excise Act provides for payment of amount of refund to the applicant only in situations specified in proviso to sub-section (2) of Section 11B of the Central Excise Act, 1944. The appellate authority held that the petitioner has attempted to claim something which the law does not permit at all. g. The appellate authority also held that the claim of refund is not a matter of right unless vested by law. The plea of injustice or hardship cannot be raised to claim refund in the absence of statutory mandate. In this regard, a reference was made to the judgment of the Hon'ble Supreme Court setting out the fundamental legal principles that in a fiscal statute, nothing can be read into its provisions and rather should not be read, which is expressly not there. In other words, an implied meaning cannot be gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 (1) and (5) of the CGST, Act reads as under:- 140. (1) A registered person, other than a person opting to pay tax under section 10, shall be entitled to take, in his electronic credit ledger, the amount of CENVAT Credit of eligible duties carried forward in the return relating to the period ending with the day immediately preceding the appointed day, furnished by him under the existing law within such time and in such manner as may be prescribed: PROVIDED that the registered person shall not be allowed to take credit in the following circumstances, namely: - (i) where the said amount of credit is not admissible as input tax credit under this Act; or (ii) where he has not furnished all the returns required under the existing law for the period of six months immediately preceding the appointed date; or (iii) where the said amount of credit relates to goods manufactured and cleared under such exemption notifications as are notified by the Government. 140 (5) A registered person shall be entitled to take, in his electronic credit ledger, credit of eligible duties and taxes in respect of inputs or input services received on or after the appointed day but the duty or t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reby repealed. (2) The repeal of the said Acts and the amendment of the Finance Act, 1994 (32 of 1994) (hereafter referred to as "such amendment" or "amended Act", as the case may be) to the extent mentioned in the sub-section (1) or section 173 shall not- (a) revive anything not in force or existing at the time of such amendment or repeal; or (b) affect the previous operation of the amended Act or repealed Acts and orders or anything duly done or suffered thereunder; or (c) affect any right, privilege, obligation, or liability acquired, accrued or incurred under the amended Act or repealed Acts or orders under such repealed or amended Acts: PROVIDED that any tax exemption granted as an incentive against investment through a notification shall not continue as privilege if the said notification is rescinded on or after the appointed day; or (d) affect any duty, tax, surcharge, fine, penalty, interest as are due or may become due or any forfeiture or punishment incurred or inflicted in respect of any offence or violation committed against the provisions of the amended Act or repealed Acts; or (e) affect any investigation, inquiry, verification (including scrutiny ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll lapse. f. The second proviso provides that no refund shall be allowed of any amount of CENVAT Credit where the balance of the said amount as on the appointed day has been carried forward under the CGST Act. 41. Thus, section 142(3) of CGST, Act clearly provides that refund application with respect of any amount relating to CENVAT Credit, duty, tax, interest or any other amount paid under the existing law is to be disposed of in accordance with the provisions of existing law and if any such amount accrues the same shall be paid in cash. Such right to refund in cash has been conferred notwithstanding anything to the contrary contained under the provisions of existing law other than the provisions of sub-section (2) of section 11-B of the Central Excise Act, 1944. 42. It is not in dispute that the refunds under the existing law of Service Tax as well as Central Excise Act, 1944 are governed by section 11B of the Central Excise Act, 1944 and subsection 2 of section 11 B also refers to application for refund made under section 11 B(1) of Central Excise Act, 1944. Further section 11B(3) of Central Excise Act, 1944 clearly provides that all kinds of refunds including those aris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act which would continue to be governed by section 11B(2) of Central Excise Act, 1944. 45. The provision of section 142(3) does not entitle a person to seek refund who has no such right under the existing law or where the right under the existing law has extinguished or where right under the new CGST regime with respect to such claim has not been exercised in terms of the provision of CGST, Act and the rules framed and notifications issued. Meaning thereby, section 142(3) does not confer a new right which never existed under the old regime except to the manner of giving relief by refund in cash if the person is found entitled under the existing law in terms of the existing law. Section 142(3) does not create any new right on any person but it saves the existing right which existed on the appointed day and provides the modalities for refund in cash if found entitled under the existing law as the entire claim is mandated to be dealt with as per the existing law. It neither revive any right which stood extinguished in terms of the existing law nor does it create a new right by virtue of coming into force of CGST, Act. 46. Section 174 of the CGST Act read with section 6 of the Ge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the matter also while rejecting the application for refund filed by the petitioner. 50. It is not in dispute that the petitioner has claimed the credit of service tax involved in the present case paid on "port services" as "input service" in ST-3 return filed on 22.09.2017, though they were not entitled to claim such a credit. It is further not in dispute that the petitioner did not include the impugned service tax paid on "port services" in its ER-1 return and accordingly was neither entitled to include nor included the same as transitional credit in TRAN-1 under CGST Act. As per the notification (Annexure-5) extending the date of filing TRAN-1 to 31.10.2017, the same was in relation to certain service tax issues which were paid after 30.06.2017 under reverse charge basis to cover instances of bills raised on 30.06.2017 since credit is available only if the payment is made and the payment in such cases could be made only after 30.06.2017. However, in the instant case the bill was admittedly generated on 23.05.2017, services availed and bill amount including service tax was paid in April 2017 but the original bill did not reach the petitioner for unknown/undisclosed reasons. 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to refund on account of the fact that the petitioner had already taken credit of the service tax paid on port services in ST-3 Return of service tax although admittedly the petitioner was not entitled to take such credit in ST-3 Return. On account of aforesaid three distinct reasons the petitioner was rightly held to be not entitled to refund under section 142(3) of CGST, Act by the impugned orders. 53. All the aforesaid provisions referred to and relied upon by the learned counsel of the petitioner do not entitle a person like the petitioner to any relief in the circumstances of acts and omissions of the service provider (port authority) or the service recipient (the petitioner) who have failed to comply the provision of law, both under the existing law and also under the CGST Act. The relied upon provisions of CGST Act do not cover any such situation relating to any consequences due to inter parte acts and omissions. In the instant case, as per the case of the petitioner, the entire problem has cropped up due to non-receipt of the invoice in original from the port authorities although the port services were availed and payments for the same to the port authorities were made by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... als (P) Ltd [2020-TIOL-164-HC-AHM-GST]. Hon'ble Gujarat High Court in the said order has held that levy itself was ultra vires. This decision has been upheld by the Hon'ble Supreme Court as reported at 2022-TIOL-49-GST-SC-LB. As the levy itself has been held to be ultra-vires the refund should be allowed to them. I am not in position to agree with the contentions raised by the appellant for simple reason that considering this ground would amount to consideration of entirely a new refund claim, which was never made before the original authority. Appellant if wish to claim the refund on this ground should file the appropriate refund claim with the original authorities on this ground provided the same is maintainable, in view of the observation made by the Hon'ble Supreme Court in case of Mafatlal Industries [1997 (89) ELT 247 (SC)] as follows: "71. Re.: (III): For the purpose of this discussion, we take the situation arising from the declaration of invalidity of a provision of the Act under which duty has been paid or collected, as the basis, inasmuch as that is the only situation surviving in view of our holding on (I) and (II). In such cases, the claim for refund is maintainable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order which is appealable under the statute, and the party aggrieved did not choose to file an appeal. This Court held that it is not open to the party to question the correctness of the order of the adjudicating authority subsequently by filing a claim for refund on the ground that the adjudicating authority had committed an error in passing the order. The provisions of the Central Excise Act, 1944 came up for consideration. The Court has observed: "10. Coming to the question that is raised, there is little scope for doubt that in a case where an adjudicating authority has passed an order which is appealable under the statute and the party aggrieved did not choose to exercise the statutory right of filing an appeal, it is not open to the party to question the correctness of the order of the adjudicating authority subsequently by filing a claim for refund on the ground that the adjudicating authority had committed an error in passing its order. If this position is accepted then the provisions for adjudication in the Act and the Rules, the provision for appeal in the Act and the Rules will lose their relevance and the entire exercise will be rendered redundant. This position, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be filed without filing an appeal. Even under Section 11 under the Excise Act, the claim for refund had to be filed within a period of six months. It was still held, in Flock (India)'s case (supra), that in the absence of an appeal having been filed no refund claim could be made. 8. The words "in pursuance of an order of assessment" only indicate the party/person who can make a claim for refund. In other words, they enable a person who has paid duty in pursuance of an order of assessment to claim the refund. These words do not lead to the conclusion that without the order of assessment having been modified in appeal or reviewed a claim for refund can be maintained." (emphasis supplied) 41. It is apparent from provisions of refund that it is more or less in the nature of execution proceedings. It is not open to the authority which processes the refund to make a fresh assessment on merits and to correct assessment on the basis of mistake or otherwise. 47. When we consider the overall effect of the provisions prior to amendment and post-amendment under Finance Act, 2011, we are of the opinion that the claim for refund cannot be entertained unless the order of assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be incorporated by means of amendment to the pleadings. The proposed amendment should not cause such prejudice to the other side which cannot be compensated by costs. No amendment should be allowed which amounts to or relates in defeating a legal right accruing to the opposite party on account of lapse of time. The delay in filing the application for amendment of the pleadings should be properly compensated by costs and error or mistake which, if not fraudulent, should not be made a ground for rejecting the application for amendment of plaint or written statement. (See South Konkan Distilleries & Anr. v. Prabhakar Gajanan Naik & Ors., (2008) 14 SCC 632). 4.11 In the case of Miles India Limited [2002-TIOL-501-SC-CUS] Hon'ble Supreme Court has held as follows: "After the matter was heard for some time and it was indicated that the Customs Authorities, acting under the Act, were justified in disallowing the claim for refund as they were bound by the period of limitation provided therefor under Section 27(1) of the Customs Act, 1962, learned counsel for the Appellant sought leave to withdraw the appeal. We accord their leave to withdraw the appeal but make it clear that the ord ..... X X X X Extracts X X X X X X X X Extracts X X X X
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