Strict rebate procedure under service tax notification bars shifting between distinct claim routes after threshold failure.

Notification No. 41/2012-S.T. prescribed two distinct rebate routes: Para 2 for claims at the scheduled rates through the specified procedure, and Para 3 for claims based on actual service tax paid only where the Para 2 and Para 3 figures differed by at least 20% of the Para 2 rebate. The text explains that if the Para 3 threshold is not met, the claimant cannot later shift to Para 2, because the notification's procedural scheme is mandatory and cannot be relaxed by the Central Excise authorities. The rejected rebate could not be reprocessed under a different route.

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Issues: Whether rebate of service tax could be granted under Para 2 of Notification No. 41/2012-S.T. after the claim under Para 3 had been rejected for being below the 20% threshold, and whether the Central Excise authorities could relax the notification's procedural scheme to allow such relief.

Analysis: The notification provided two distinct modes for claiming rebate: Para 2, which required claim before the customs authorities at the prescribed rates in the Schedule, and Para 3, which permitted rebate based on actual service tax paid but only where the difference between the claims under Para 2 and Para 3 was not less than 20% of the rebate admissible under Para 2. The claim in question did not satisfy the Para 3 threshold. The scheme of the notification also did not permit the Central Excise authorities to grant relief under Para 2 after the claimant had pursued the Para 3 route, because Para 2 claims were to be made only through the procedure specifically laid down for that route. The restriction built into the notification was mandatory and could not be relaxed merely because the rejected amount was lower than the Para 2 entitlement.

Conclusion: The claim could not be shifted to Para 2 at that stage, and the rejection of the rebate claim was in law.

Final Conclusion: The revision application failed, and the rejection of the rebate claim was upheld.

Ratio Decidendi: Where a notification prescribes mutually distinct rebate procedures with specified conditions and forums, relief must be claimed strictly under the chosen and applicable route, and the prescribed threshold and procedural restrictions cannot be relaxed by the adjudicating authority.

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