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TMI Blog2025 (2) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... on'ble High Court of Karnataka in the case of COMMISSIONER OF CENTRAL EXCISE (APPEALS), BANGALORE VERSUS KVR CONSTRUCTION [2012 (7) TMI 22 - KARNATAKA HIGH COURT] held that 'When once there was no compulsion or duty cast to pay this service tax, the amount of Rs. 1,23,96,948/- paid by petitioner under mistaken notion, would not be a duty or "service tax" payable in law. Therefore, once it is not payable in law there was no authority for the department to retain such amount. By any stretch of imagination, it will not amount to duty of excise to attract Section 11B. Therefore, it is outside the purview of Section 11B of the Act.' It is found that against the order of the Hon'ble High Court of Karnataka the SLP filed by the Revenue was dismissed by the Hon'ble Supreme Court reported in COMMISSIONER VERSUS KVR CONSTRUCTION [2011 (7) TMI 1334 - SC ORDER]. Conclusion - The rejection of the refund claims by the Adjudicating authority/Appellate authority on the grounds of limitation under section 11B of the Central Excise 1944 as made applicable to service tax matters by virtue of Section 83 of the Finance Act, 1994 is not tenable and are liable to be set as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls and on Appeal Commissioner (Appeals) vide common Order-in-Appeal No. 170-229/2012 affirmed the order of the adjudicating authority holding that there is delay in filing the appeals ranging between 2(two) months to 4(four) months and the reasons for the delay explained by the appellants is devoid of any sufficient cause and hence the appeals were not admitted on the ground of limitation. The appellants filed writ petitions before the Hon'ble High Court of Karnataka. The Hon'ble High Court set aside the order of the appellate authority holding that there is no application of mind and ex-facie the order suffers from an apparent error on the face of record calling for interference and directed the appellate authority to consider the matter afresh and pass orders in accordance with law having regard to section 85 of the Finance Act, 1994. 4. The appellants were heard by the appellate authority as per the directions of the Hon'ble High Court and an order was passed vide Order-in-Appeal No. 489-548/2016 dated 18.04.2016, wherein it is held that for the period prior to 01.07.2010, when a developer enters into the construction agreement with purchaser which requires payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refunded under section 72 of the contract act, reliance is placed on the decision of the Hon'ble Supreme Court by the adjudicating Authority even in case of illegal levy the refund claim has to undergo the scrutiny of limitation provided under the provisions of Central Excise Act. 7. The appellants aggrieved by the Orders-in-Original No. 3/2020 of the Adjudicating Authority filed appeals, which were disposed by Commissioner (Appeals) vide Order-in-Appeal Nos. 101-122/2022-23 CT dated 20.09.2022. The appellate authority has remanded the matter for determination/decision on the eligibility of the refund claims of claimants at Sl. nos. 1. Bhavani Rajagopalan, 10. Kailash T V and 14. Naveen P G on the basis of payment challans vis-a-vis the date of filing of refund claim as part of their refund claim was within the period of limitation and in all other cases the refund claim was rejected having been filed beyond the period prescribed under section 11B of the Central Excise Act, 1944. 8. Aggrieved by the order of Commissioner (Appeals) the appellants filed these 22(twenty two) appeals before this Tribunal and since the issue is common and all these appeals, they are being decided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of Way 2 Wealth Brokers Pvt Ltd Vs. Commissioner., 2022(61) GSTL 349 (Kar), wherein it was held that department will not have the authority to retain amount paid by assessee when there is lack of authority to collect such service tax not liable to be paid by the assessee. Refund is not hit by limitation and payment made by mistaken notion is not "duty"; appellant also places reliance on the decision of the Hon'ble High Court of Madras in the case of 3E Infotech Vs. CESTAT., 2018(18) GSTL 410 (Mad), wherein it was held that when service tax is paid under mistake of law, refund is admissible irrespective of period covered by refund application. Further, the claim of the respondent in refusing to return the amount would go against the mandate of Article 265 of the Constitution of India, which provides that no tax shall be levied or collected except by authority of law. 12. The learned counsel also places reliance on the decision of the Hon'ble Tribunal in the case of Oil India Ltd Vs. Commissioner., 2023(385) ELT 422 (Tri-Kol) wherein it is held that when service tax is paid under mistake of law, statutory limitation period prescribed under Section 11B o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... find that the Hon'ble High Court of Karnataka in the case of Commr. of C. Ex. (Appeals), Bangalore Vs. KVR Construction - 2012 (26) STR 195 (Kar.) held that:- "23. Now we are faced with a similar situation where the claim of the respondent/assessee is on the ground that they have paid the amount by mistake and therefore they are entitled for the refund of the said amount. If we consider this payment as service tax and duty payable, automatically, Section 11B would be applicable. When once there was no compulsion or duty cast to pay this service tax, the amount of Rs. 1,23,96,948/- paid by petitioner under mistaken notion, would not be a duty or "service tax" payable in law. Therefore, once it is not payable in law there was no authority for the department to retain such amount. By any stretch of imagination, it will not amount to duty of excise to attract Section 11B. Therefore, it is outside the purview of Section 11B of the Act". 16. Further, we find that against the order of the Hon'ble High Court of Karnataka the SLP filed by the Revenue was dismissed by the Hon'ble Supreme Court reported in Commr. Vs. KVR Constructions 2018 (14) GSTL J70 (SC ..... X X X X Extracts X X X X X X X X Extracts X X X X
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