Appeal granted for service tax refund, rejection overturned on export docs & unjust enrichment grounds.

The Tribunal allowed the appeal, setting aside the rejection of the refund claim for service tax paid by the appellant for the period in question. The rejection based on absence of export documents was deemed irrelevant as the appellant fulfilled conditions of the exemption notification, and any delay in compliance was considered procedural. The rejection on the grounds of unjust enrichment was also overturned, as showing the tax as an expense did not automatically imply passing on the burden to consumers. The appellant was granted the refund claim for the service tax paid.

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Issues:
Challenge to Order-in-Appeal dated 18.08.2020 regarding refund claim of service tax paid for the period from July 2012 to June 2017 in relation to export of granite/other stone slabs. Rejection of refund claim based on absence of export documents and unjust enrichment of the appellant.

Analysis:
The appellant, engaged in 100% export of goods, filed a refund claim for service tax paid for the mentioned period. The claim was rejected by the department citing wrong payment of service tax exempted under Notification No. 31/2012. The appellant submitted voluminous documents to prove export, including EXP-1 and EXP-2 forms. The rejection was based on lack of export documents and unjust enrichment. The appellant argued that all conditions were met and any delay in compliance was procedural, not substantial. The Tribunal referred to previous cases where delay in compliance did not warrant denial of refund under exemption notifications.

The Tribunal found that the appellant fulfilled the conditions of the exemption notification and the delay in compliance was not substantial enough to deny the refund claim. Citing case laws, it held that procedural lapses should not lead to denial of substantial benefits like refunds. Therefore, the rejection based on the absence of export documents was set aside.

Regarding the second ground of rejection, the Tribunal noted that the service tax was already paid by the appellant and shown as an expense in the profit and loss account. The appellant's partner affirmed that if refunded, it would be credited as income. The Tribunal disagreed with the presumption of unjust enrichment, citing a Bombay High Court case that clarified showing an amount as expenses does not necessarily mean passing on the burden to consumers. The Tribunal held the rejection on the grounds of unjust enrichment to be presumptive and irrelevant.

In conclusion, the Tribunal found both grounds of rejection by the Commissioner (Appeals) to be irrelevant and contrary to established decisions. The order under challenge was set aside, and the appeal was allowed, granting the appellant the refund claim for the service tax paid.

Judgment:
The Tribunal set aside the rejection of the refund claim based on procedural lapses and unjust enrichment, allowing the appeal in favor of the appellant.

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