Delayed refund claims must be decided with condonation requests on merits when the notification allows extension of time.

A refund claim under a service tax notification that permits extension of the filing period cannot be rejected as time barred without considering the accompanying request for condonation of delay. The competent authority must exercise the discretionary power to extend time on the facts of the case and record reasons while deciding whether the delayed claim should be accepted. A two-stage approach, first on limitation and then on refund, is not required where the notification itself allows extension. The refund claim was therefore to be examined on merits along with the delay request, and rejection solely on limitation was inconsistent with the notification scheme.

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Issues: Whether the refund claim of service tax under Notification No. 9/2009-ST dated 03.03.2009 was barred by limitation, and whether the request for condonation of delay could be considered along with the refund claim.

Analysis: The relevant notification permitted filing of the refund claim within six months or within such extended period as the Assistant Commissioner might allow. The delayed claim was accompanied by a request for condonation, and there was no legal basis to insist on two separate proceedings, first on delay and then on refund. The discretionary power to extend time had to be exercised on the facts of the case, with reasons recorded while deciding whether the delayed claim could be accepted. The approach of rejecting the claim merely as time barred without considering the request for extension was inconsistent with the wording and scheme of the notification.

Conclusion: The refund claim could not be rejected solely on the ground of limitation, and the request for condonation of delay was required to be considered along with the refund claim. The Revenue's appeal failed.

Final Conclusion: The order allowing the refund claim was sustained, and the Revenue's challenge was rejected.

Ratio Decidendi: Where a refund notification empowers the competent authority to extend the filing period, a delayed refund claim accompanied by a request for condonation must be decided on merits with reasons, and it cannot be rejected as time barred without considering that request.

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