2006 (1) TMI 571 - AT - Service Tax

Tribunal orders fresh case review based on Indo-Nippon Chemicals principles. Mutual mistake refund claim not time-barred.

The Tribunal remanded the case back to the Commissioner (A) for fresh disposal, based on the principles outlined in the Indo-Nippon Chemicals Co. Ltd. ... - Issues involved: Refund claim rejection based on time limitation.In the present case, the appellant, engaged in providing 'pilotage services' initially categorized as 'management consultant services,' sought a refund for service tax paid before their unit was brought under service tax regulations. The refund claim was rejected by the department citing time limitation. The appellant relied on the case law of Hexacom (I) Ltd. v. Commissioner of Central Excise, Jaipur [2003] 156 ELT 357 (Tri.-Del.) to argue that the provisions regarding refund of service tax should not apply in this situation as the payment made was not related to service tax. The Commissioner (A) disagreed with this argument, leading to an appeal. Additionally, the appellant cited the case law of Indo-Nippon Chemicals Co. Ltd. v. UOI [2005] 3 STJ 1025 (Guj) to highlight the application of section 17 of the Limitation Act, 1963 in cases of mutual mistake, which led to a refund claim being considered within the time limit.The Tribunal, considering the principles outlined in the Indo-Nippon Chemicals Co. Ltd. case, decided to remand the matter back to the Commissioner (A) for fresh disposal. The decision was based on the understanding that the refund claim, which was based on the discovery of a mutual mistake, should not be limited by the date of the reversal of Modvat Credit but rather from the date when the mistake was discovered. As a result, the appeal was allowed for remand to the Commissioner (A) for reconsideration in light of the principles discussed.