Refund under construction circular denied where land ownership was unproved and service tax burden was passed on to buyers.

Refund under Circular No. 108/02/2009-ST was available only where construction was carried out by the freehold owner on its own land. The record did not show absolute ownership of the land on which the flats were built; the appellant had only possessory rights and the landowner and builder were different persons. On that basis, the circular benefit was not available. The claim also failed on unjust enrichment because the appellant did not establish that the service tax burden had not been passed on to the buyers. The refund claim was therefore not maintainable.

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Issues: Whether the appellant was entitled to refund by invoking Circular No. 108/02/2009 ST dated 29.01.2009 on the footing that the construction activity was self service on land owned by it, and whether the claim was barred by unjust enrichment.

Analysis: The refund claim was examined on the basis that the benefit under the circular applied only where the builder was the freehold owner of the land and the construction was undertaken on such land. On the record, no document was produced to establish that the appellant had absolute ownership of the land on which the flats were constructed. The authority found that the appellant had only possessory rights, and that the land owner and the builder were different persons. It was also found that the appellant failed to prove that the service tax burden had not been passed on to the ultimate buyers.

Conclusion: The appellant was not entitled to the benefit of the circular, and the refund claim was barred by unjust enrichment.

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