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TMI Blog2024 (10) TMI 1060X X X X Extracts X X X X X X X X Extracts X X X X ..... deration of the refund application. Various aspects for claim of refund under the indirect tax statutes have been elaborately discussed by the Constitutional Bench of the Hon ble Supreme Court in the case of Mafatlal Industries Ltd. and Others Vs. Union of India and Others [ 1996 (12) TMI 50 - SUPREME COURT] . The Hon ble Apex Court have categorized the claim of refund broadly into three heads i.e., (i) unconstitutional levy; (ii) illegal levy; and (iii) tax paid under mistake of law. Since, the appellants had filed the refund claim in the form and manner prescribed under Section 11B of the Act of 1944, the provisions contained therein alone have the application and accordingly, the department had acted upon, based on such statutory provision in disposal of such refund applications. Thus, since the appellants had not filed the refund applications within the stipulated time frame of one year , rejection of the claim amounting to Rs.6,13,77,646/- by the learned Commissioner (Appeals) is in consonance with such statutory provisions. In view of the fact that the refund application filed by the assessee-appellants in the year 2017 was now being considered for refund, which is much beyon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rein, has inserted Section 103 in the Finance Act, 1994. The effect of addition of the said Section 103 in the Act of 1994, is that exemption from payment of service tax, earlier provided under the Notification dated 20.06.2012, was restored in respect of services provided by way of construction, pertaining to the port for the period from 01.04.2015 to 29.02.2016 (both days inclusive). The said section also provided that, service tax which has been collected, but which would not have been so collected, had the said retrospective restoration of the exemption been in force, during all material times, shall be refunded. 1.4 During the period of withdrawal of the exemption notification as stated above, the service providers had charged service tax in the invoices issued by them, which was availed as CENVAT credit by the appellants. In view of grant of retrospective exemption benefit provided for the period 01.04.2015 to 29.02.2016, the assessee-appellants, being the recipient of original works contract for development of port, had filed the application dated 27.10.2017, claiming refund of service tax of Rs.9,45,69,194/- paid by them to the above service providers. The said application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 13.01.2023, in quashing and setting aside the order dated 13.01.2021 passed by the Tribunal. The appeal of the assessee-appellant was allowed by way of remand to the Tribunal, for a decision on merits, as per law. 2. Pursuant to the directions contained in the order dated 13.01.2023 of the Hon ble Bombay High Court, the Tribunal is taking up the appeals being Nos. ST/85457/2020 and ST/85110/2020 for hearing and disposal. In addition to those appeals, the assessee-appellant has also filed the appeal being No. ST/86961/2021 against the Order-in-Appeal No. SM/GST/A-I/MUM/123/20-21 dated 08.03.2021, wherein the learned Commissioner (Appeals) has rejected the interest claim on the refund amount of Rs.5,90,99,124/-, already sanctioned by the department. In addition to the appeal filed against the order dated 08.03.2021, the assessee-appellant has also filed another appeal, being No. ST/86290/2022, against the Order-in-Original No. MUM.SOUTH/CGST/Pr. Commr.-39/21-22 dated 30.11.2021 wherein, in response to the order dated 13.01.2021 passed by the Tribunal, the original authority had initiated proceedings for recovery of the erroneously sanctioned refund and confirmed the same. For bett ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e learned Commissioner (Appeals) has considered the date of filing of refund application as 27.10.2017, and rejected such claim for refund of the amount of service tax paid for the period prior to 27.10.2016. We are in agreement with the observations made by the learned Commissioner (Appeals) that the date of refund claim should be reckoned from the date, when the duly signedin application form, together with the relevant documents, were filed before the department i.e., on 27.10.2017. Date of filing of refund claim application on 25.09.2016, which has been claimed by the assesseeappellants, cannot be considered as proper or valid ground inasmuch as it is the relevant document(s) accompanying with the refund application, which have to be examined by the officer of Central Excise for consideration of the issue, whether the assessee would be entitled for refund or otherwise. Since, no documents were available with the department on 25.09.2016, mere submission of application in online mode would not meet the requirements of Section 11B of the Act of 1944. The statute, in clear terms, provides that the refund application has to be filed in the form and manner, as prescribed, and it sho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13.11.2016, in our considered view, the authorities below have correctly rejected the refund applications, wherever the same were filed beyond the prescribed time frame of six months, by holding the same as barred by limitation of time. 5.3 We find that countering the findings recorded in the impugned order by the learned Commissioner (Appeals), the assessee-appellants have contended that the time consumed in the Ministry of Shipping for obtaining clarification on the issue arising out of the Finance Act, 2016 should be excluded for the purpose of computation of the limitation period for filing of refund application. Further, they have also stated that since the disputed service was exempted from payment of service tax with retrospective effect, payment made out of ignorance by the service provider, should also be considered as erroneous payment; and in such eventuality, the limitation provided under Section 11B of the Act of 1944 shall not have any application. In this context, learned Advocate for the assessee-appellants has relied upon the following judgements delivered by the judicial forum, in the case law compilation filed on 01.03.2024: (i) Vasudha Bommireddy Vs. Assistant C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... well settled that if the legislative intent is to prescribe a time limit for doing a particular task in a particular manner, then the authorities functioning under the respective legislation cannot interpret the mandate in a different manner, in order to prescribe a different time frame for completing the task or assignment. In this context, while interpreting the provisions of Section 35 of the Central Excise Act, 1944, wherein a time limit has been prescribed for filing of appeal and for condonation of the delay in filing of such appeal, the Hon ble Supreme Court, in the case of Singh Enterprises Vs. Commissioner of C. Ex. Jamshedpur - 2008 (221) E.L.T. 163 (S.C.), have held as under: 8. The Commissioner of Central Excise (Appeals) as also the Tribunal being creatures of Statute are vested with jurisdiction to condone the delay beyond the permissible period provided under the Statute. The period upto which the prayer for condonation can be accepted is statutorily provided. It was submitted that the logic of Section 5 of the Indian Limitation Act, 1963 (in short the Limitation Act ) can be availed for condonation of delay. The first proviso to Section 35 makes the position clear t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Excise Act and the Rules framed thereunder must be adhered to. The authorities functioning under the Act are bound by the provisions of the Act. If the proceedings are taken under the Act by the department, the provisions of limitation prescribed in the Act will prevail. It may, however, be open to the department to initiate proceedings in the Civil Court for recovery of the amount due to the department in case when such a remedy is open on the ground that the money received by the assessee was not in the nature of refund. This was the view taken by the Tribunal in a previous decision in the case of Miles India Ltd. v. The Assistant Collector of Customs but it was assailed before this Court. The appeal was withdrawn. This Court observed 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 in the relevant provisions of the Customs Act, 1962. If really the payment of the duty was under a mistake of law, the party might seek recourse to such alternative remedy as it might be advised . 5.6 Various aspects for claim of refund under the indirect tax statutes have been elab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. The aggrieved party can invoke Section 72 of the Contract Act, file a suit or a petition under Article 226 of the Constitution, and pray for appropriate relief inclusive of refund within the period of limitation provided by the appropriate law. [Dulabhai s case (supra) - Para 32 - Clauses (3) and (4)]. Category (II) where the levy is based on misconstruction or wrong or erroneous interpretation of the relevant provisions of the Act, Rules or Notifications; or by failure to follow the vital or fundamental provisions of the Act or by acting in violation of the Fundamental Principles of judicial procedure :- Under this category, every error of fact or law committed by the statutory authority or Tribunal, irrespective of its gravity, or nature of infirmity, will not be covered. It is confined to exceptional cases, where the provisions of a particular Act have not been complied with or the statutory Tribunal has not acted in conformity with fundamental principles of judicial procedure , as stated in Mask Co. s case (supra) and in Dulabhai s case (supra). The scope of the above dicta, should be understood in the background of/in accord with the observations of the earlier Constitution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gment delivered by the Hon ble Apex Court in the case of Doaba Co-operative Sugar Mills (supra), it become apparent that if a refund claim is filed under a particular statute (in this case, the Act of 1944), then the authorities functioning under such statute are bound to follow the statutory dictates contained therein. Since, specific time limit of one year has been prescribed in the said statute under Section 11B for consideration of the refund application, the statutory authorities cannot go beyond such dictates and have to strictly observe the said statutory provision for consideration of the refund application. Further, with regard to specific time limit for performing certain acts by the appellate authority is concerned i.e., the Commissioner (Appeals) for entertainment of appeal filed before him, the Hon ble Supreme Court in the case of Singh Enterprises (supra), in clear and unambiguous terms, have ruled that the time limit prescribed under Section 35 of the Act of 1944 should alone be considered for filing of appeal before the Commissioner (Appeal) and that too only by the authority so specified in that statute. Since, the said authority alone has been vested with the powe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of interest on delayed sanction of the refund claim amount, in terms of Section 11BB of the Act of 1944. Therefore, against such original order dated 04.11.2020, the assessee-appellants had preferred appeal before the learned Commissioner (Appeals-I), Mumbai, which was dismissed vide Order-in-Appeal No. SM/GST/A-I/MUM/123/20-21 dated 08.03.2021. Feeling aggrieved with the said order dated 08.03.2021, the assessee-appellants have filed the appeal, being No. ST/86961/2021 before the Tribunal. We find that in support of dismissal of appeal filed by the assessee-appellants, learned Commissioner (Appeals), by referring to and relying upon the Final Order No. A/85801-85802/2021 dated 13.01.2021 passed by the Tribunal, has held that since, the refund claims were not maintainable, the question of grant of interest under Section 11B of the Act of 1944 does not arise. We find that the Order dated 13.01.2021 passed by the Tribunal was set aside vide judgement dated 13.01.2023 passed by the Hon ble High Court of Bombay and the appeals were restored to the file of the Tribunal. Pursuant to the said judgement dated 13.01.2023, since the appeals were taken up for hearing afresh and order is bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llate authority in sanctioning the refund should also constitute as an order passed under sub-section (2) of Section 11B of the Act of 1944, for the purpose of grant of interest. In the present case, the refund applications filed by the assessee-appellants way back in the month of October/ December, 2017, were under dispute, which are being resolved by our present order. Since, the refund claim is being favourably considered by us, as per the Explanation appended to Section 11BB of the Act of 1944, this order of the Bench should be considered as an order, as if, passed by the Assistant/Deputy Commissioner of Central Excise under sub-section (2) of Section 11B of the Act of 1944. In view of the fact that the refund application filed by the assessee-appellants in the year 2017 was now being considered for refund, which is much beyond the statutory time frame of three months, in our considered view, the assessee-appellants should be entitled for claim of interest for the period, to be computed from expiry of three months from the date of filing of refund applications, till sanction of the refund amount. Since, the exercise for quantification of interest is required to be done at the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by way of remand to the original authority for quantification of the amount of interest. 7.1 to 7.3 4. ST/86290/2022 Impugned order dated 30.11.2021 is set aside and the appeal is allowed in favour of the assessee-appellants. 8 10. Before parting with the case, we would like to highlight the attitude of the assessee-appellants in pursuing the matter, upon conclusion of hearing by the Bench. The assessee-appellants have filed letter dated 22.03.2024, praying for listing of the matter afresh for submission of final written submission and argument, being fully aware of the fact that the appeals were heard at length on different occasions and finally, got concluded on 01.03.2024 with the record, Heard both sides. Orders reserved. Even thereafter and despite finality to the proceedings, awaiting issuance of the order, communicating the decision of the Tribunal, liberty was granted to the learned Advocate for filing of written submissions, if any, which was availed by the learned Advocate, in filing the written submission on 05.03.2024. However, the assessee-appellants sought to insinuate themselves into the proceedings with request for re-listing and fresh hearing. This is not only u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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