2016 (12) TMI 927 - AT - Service Tax

Appeal allowed for refund of inadvertent double payment of Service Tax. Cooperation key for prompt refunds.

The Tribunal allowed the appeal in favor of the appellant, directing the adjudicating authority to refund the excess amount of Rs. 1,54,540 due to ... Refund of excess service tax paid - Double payment (erroneous) of service tax - Treatment of excess payment as advance towards subsequent liability - Remand for verification and refundRefund of excess service tax paid - Double payment (erroneous) of service tax - Remand for verification and refund - Refund of the excess amount paid twice by the assessee was to be granted after verification; matter remanded to adjudicating authority for verification and refund. - HELD THAT: - Both GAR-7 challans for identical amounts were generated on the same date and the Tribunal accepted that the double payment resulted from an unintentional human error by the appellant's chief accountant. The appellant had filed a refund claim with the Department within a reasonable time. The Tribunal observed that, although the Department could have advised adjustment of the excess as an advance for the subsequent period when first approached, that option is no longer available. Considering the circumstances and the appellant's timely approach for refund, the Tribunal directed a remand to the adjudicating authority with a clear mandate to verify the payment details from the assessee's bank records and to grant refund of the excess amount without further delay. The Tribunal instructed the adjudicating authority to complete verification and refund preferably within three months of receipt of the order and directed the assessee to cooperate in the verification process.Appeal allowed by remand; adjudicating authority to verify payments and refund the excess amount to the assessee within three months, with the assessee to cooperate.Final Conclusion: The Tribunal accepted that an identical double payment of service tax occurred by mistake, and remanded the matter to the adjudicating authority to verify bank payment details and grant refund of the excess amount, directing prompt disposal (preferably within three months) and cooperation by the assessee. Issues:1. Refund claim for double payment of Service Tax.2. Clarification on excess payment and admissibility of refund claim.Analysis:1. The appellant, registered under Service Tax for Business Auxiliary Service, made double payment of Service Tax for services rendered in September 2009. The Chief Accountant paid the tax twice on the same day, totaling Rs. 1,54,540. The appellant filed a refund claim before the Commissioner of Service Tax due to the erroneous double payment. The Deputy Commissioner issued a Show Cause Notice, questioning the delay in payment and the lack of clarification on the excess payment. The Deputy Commissioner rejected the claim, stating the matter was not clarified. The lower appellate authority upheld the decision, leading to the appeal before the Tribunal.2. During the hearing, the Chief Accountant explained the circumstances of the double payment and provided copies of both challans. The Assistant Commissioner reiterated the lower authorities' findings. The Tribunal observed that both challans were generated on the same day for the same amount, confirming the inadvertent double payment. Recognizing the human error, the Tribunal directed the adjudicating authority to grant a refund of the excess amount to the appellant. The Tribunal suggested the authorities could have guided the appellant to treat the excess payment as an advance for the subsequent period, a practice allowed by the Department. As this option was not pursued, the Tribunal ordered the refund of Rs. 1,54,540 to the appellant, emphasizing cooperation in verifying payment details. The appeal was allowed, remanding the matter for refund processing within three months.