Service tax refund claims remain subject to statutory limitation despite payment made under mistake of law.

Refund claims under the service tax regime are governed by the one-year limitation under Section 11B of the Central Excise Act, 1944, applied through Section 83 of the Finance Act, 1994. A claim filed after expiry of the statutory period is not maintainable, and payment made under mistake of law does not displace or extend that limitation. The refund machinery under the Act remains binding on departmental authorities, so a time-barred refund claim is liable to be rejected.

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Issues: Whether the refund claims were barred by limitation under Section 11B of the Central Excise Act, 1944, and whether payment of tax under mistake of law excluded the statutory limitation.

Analysis: The refund claims were filed after expiry of one year from the relevant dates of payment. The statutory limitation under Section 11B governed refund claims in service tax matters by virtue of Section 83 of the Finance Act, 1994. The plea that the tax had been paid under mistake of law did not displace the applicability of the prescribed limitation. The refund machinery under the Act was held to be binding on the departmental authorities, and the claim beyond the statutory period was therefore not maintainable.

Conclusion: The refund claim was time-barred and the rejection of the appeal was upheld.

Ratio Decidendi: Refund claims under the service tax regime are subject to the limitation prescribed under Section 11B of the Central Excise Act, 1944, and a claim filed beyond the statutory period cannot be maintained merely on the ground that the tax was paid under mistake of law.

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