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of <h1>High Court affirms Tribunal's decision on Service tax refund, citing credit notes & lack of service provided.</h1> <h3>COMMR. OF SERVICE TAX, BANGALORE Versus SHIVA ANALYTICALS (I) LTD.</h3> COMMR. OF SERVICE TAX, BANGALORE Versus SHIVA ANALYTICALS (I) LTD. - 2009 (14) S.T.R. 301 (Kar.) , 2009 (92) RLT 664 (Kar.) , [2009] 21 STT 328 (KAR.) Issues:1. Correctness of the order passed by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) regarding the refund of Service tax.2. Whether the respondent is liable to pay Service tax.3. Validity of the Tribunal's decision based on the issuance of credit notes for the refund.Analysis:1. The appeal before the High Court questioned the correctness of the order dated 22-2-2007 passed by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) regarding the refund of Service tax amounting to Rs. 5,69,259/- claimed by the respondent. The original authority had granted the refund, but the Commissioner later held it to be erroneous and directed to re-credit the amount. The Tribunal, however, allowed the appeal on the grounds that the respondent issued credit notes towards the refund of service tax, making the refund order legal and proper.2. The High Court analyzed that the respondent had paid the service tax based on a wrong assumption of liability. The original authority found that the respondent had not rendered any service, leading to the refund claim. However, the revisional authority reversed this finding. The Tribunal, in its decision, relied on the case of Mohd. Ekram Khan & Sons v. Commissioner of Trade Tax, where it was established that the issuance of credit notes for the refund of service tax justified the legality of the refund order. The High Court concurred with the Tribunal's decision, emphasizing that Service Tax is payable by a service provider, and since the respondent issued credit notes, the refund was deemed valid.3. In conclusion, the High Court found no grounds for interference in the Tribunal's decision. It stated that the order under appeal was legally sound, citing the reliance on the precedent mentioned. The High Court held that no questions of law, especially substantial ones, arose for consideration in the appeal. Consequently, the appeal was deemed devoid of merit and dismissed accordingly.
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