2016 (12) TMI 163 - AT - Service Tax

Appellant's Refund Challenge Upheld: Time Limits, Invoice Discrepancies Clarified

The appellant challenged the rejection of a refund amount of 81,368, citing issues related to time limitations and invoice discrepancies. The CESTAT ... Rejection of refund claim - invoices issued showing service tax amount are not in the name of the appellant - Held that: - the debit note can be correlated with the invoices produced by the appellant and invoices clearly indicate that they are concerned with the appellants, namely, Karnawat International (P) Ltd. Therefore, only on this ground that invoices are not in the name of the appellant, where the debit notes show direct correlation of the services provided by the service provider, refund of cenvat credit cannot be rejected. The matter, therefore, deserves to be remanded to the Original Adjudicating Authority, who will verify the documents and grant the refund accordingly. Time bar in filing refund claim - Held that: - relevant date for computing one year period prescribed under Section 11B of Central Excise Act, 1944 is to be determined by applying Rule 5 of Cenvat Credit Rules, 2004; limitation provided under Section 11B ibid has to be satisfied; and relevant date for computing one year period is the date on which final products are cleared from export. - the refund claims have to be examined by the Original Adjudicating Authority in the light of above findings and the matter is to be decided by him/ her within 4 months of receipt of this order. Appeal allowed - matter remanded back. Issues:1. Appeal against rejection of refund of cenvat credit not utilized2. Time limitation for filing refund claims3. Rejection of refund amount due to invoices not in the name of the appellantAnalysis:1. In Appeal No. 790/2011, the appellant challenged the rejection of a refund amount of &8377; 81,368. The Commissioner (Appeals) held that a refund cannot be filed for unutilized cenvat credit if not done quarterly and that the claim was time-barred. However, the CESTAT clarified that as per Notification No. 5/2006-CE(NT), a refund can be filed once for any quarter in a calendar year. Citing the case of Western Cans Pvt. Ltd. vs CCE Mumbai-I, the CESTAT emphasized that even an annual refund filing is permissible to avoid multiplicity.2. Regarding the time limitation issue, the Commissioner (Appeals) rejected certain amounts as time-barred in the same appeal. Referring to the case of GTN Engineering (I) Ltd. vs CCE Coimbatore, the CESTAT highlighted that the one-year period under Section 11B of the Central Excise Act, 1944, is determined by Rule 5 of Cenvat Credit Rules, 2004. The relevant date for computation is when final products are cleared for export. The CESTAT directed the Original Adjudicating Authority to examine the refund claims based on these findings within four months.3. In Appeal No. 791/2011, the refund claim of &8377; 1,15,088 was rejected due to invoices not being in the appellant's name. However, the CESTAT found that the invoices, although issued by the service provider, were related to the appellant as evidenced by debit notes. The CESTAT ruled that the rejection based solely on the name mismatch was unjustified and remanded the matter to the Original Adjudicating Authority for proper verification and refund approval.In conclusion, both appeals were remanded to the Original Adjudicating Authority for reevaluation in light of the CESTAT's clarifications and relevant legal precedents, with a directive to decide on the matters within four months of receiving the order. The appeals were allowed by way of remand.