2016 (5) TMI 136 - AT - Service Tax

Tribunal orders refund on service tax overpayment, stresses fair procedures

M/s. Abhijeet Infrastructure Limited Versus Commissioner of Service Tax Cell, Central Excise Head Quarters, Nagpur

The Tribunal allowed the appeal, remanding the case for a detailed verification process. The authority was directed to refund any excess service tax ... Refund claim - Amount of service tax paid in excess than the amount actually payable by them under Management & Repair Services - Held that:- if it is established that the gross receipt of service charges is lesser than the gross service charges on which service tax was paid then the excess paid service tax is prima facie refundable to the appellant. If the lower authority has any doubt about the accounting, calculation, the right course of action is that he should call the appellant in person and give them the opportunity to explain the doubts as regard the accounting and calculation etc. Therefore, the matter is remanded back to the original adjudicating authority with a direction to verify the claim properly with the books of account and details submitted by the appellant. If there is any doubt or query the appellant should be called and given an opportunity to explain the books of account, the accounting of the receipt of service charges, payment of service tax and the excess paid service tax etc. on verification, if the adjudicating authority finds that there is an excess payment of service tax, the same should be refunded in accordance with law. - Decided in favour of appellant by way of remand Issues Involved: Refund claim rejection under service tax for excess payment.Analysis:The appeal was against the Order-in-Appeal upholding the rejection of a refund claim filed by the appellant, a service tax assessee paying tax under various categories. The appellant contended they had overpaid an amount under Management & Repair Services and sought a refund. The Order-in-Original rejected the claim, leading to the appeal before the Commissioner (Appeals), which was also dismissed, prompting the current appeal.During the hearing, the appellant was absent, but a letter on record requested a decision on merit. The Revenue representative supported the rejection, stating the adjudicating authority had considered the appellant's submissions and correctly rejected the refund claim. The appellant's calculation indicated an excess payment of service tax, arguing for the refund based on the discrepancy between service charges received and those taxed.Upon review, the Tribunal found the appellant's claim plausible and noted the lack of proper verification by the lower authority regarding the accounting and calculation discrepancies. The Tribunal emphasized the need for a thorough verification process, suggesting a remand to the original authority for proper examination. It directed the authority to verify the claim with the appellant's records, allowing for explanations and a personal hearing to address any doubts or queries. If an excess payment was confirmed, the Tribunal mandated a refund in accordance with the law, emphasizing the appellant's right to a fair hearing throughout the process.In conclusion, the Tribunal allowed the appeal by remanding the case for a detailed verification process and directed the authority to refund any excess service tax payment found in favor of the appellant. The decision highlighted the importance of thorough examination and fair procedures in handling refund claims under service tax laws.