2022 (3) TMI 750 - AT - Service Tax

Appeal successful in restoring original refund amount, subsequent reduction overturned. Order upheld, reduction lacked legal basis.

The appeal was allowed, and the original refund amount of Rs. 22,81,472 was restored, overturning the subsequent reduction to Rs. 2,45,024. The Member ... Sanction of refund - mistake apparent on record - power to amend order under Section 74 of the Finance Act, 1994 - appealability of adjudicating authority's order under Section 84 of the Finance Act, 1994 - restoration of original orderSanction of refund - appealability of adjudicating authority's order under Section 84 of the Finance Act, 1994 - power to amend order under Section 74 of the Finance Act, 1994 - mistake apparent on record - restoration of original order - Validity of the adjudicating authority's subsequent amendment reducing the sanctioned refund and the consequent restoration of the original sanction. - HELD THAT: - The Tribunal found that the adjudicating authority had, after verification by the Range Officer, sanctioned the refund claim by order dated 15.10.2020 based on the Range Officer's calculation and recommendation. Such a sanctioning order is appealable and, if aggrieved, must be challenged before the Commissioner (Appeals) under Section 84 of the Finance Act, 1994. The later order dated 17.12.2020, which reduced the refund on the ground that the appellant had claimed a longer limitation period, was held to be an amendment of the earlier sanctioning order. The Tribunal observed that the reduction could not be sustained as an amendment under Section 74 of the Finance Act, 1994 because the earlier order was passed after the Range Officer's verification and could not be characterised as suffering from a 'mistake apparent on record.' Consequently, the impugned amendment lacked legal sustainability. Applying these principles, the Tribunal restored the original order dated 15.10.2020 and directed compliance therewith within 30 days. [Paras 4, 5]The amendment by order dated 17.12.2020 is not sustainable; the order dated 15.10.2020 is restored and the adjudicating authority is directed to comply with it within 30 days.Final Conclusion: Appeal allowed; the reduction of the sanctioned refund by the subsequent order is set aside and the original sanctioning order dated 15.10.2020 is restored with a direction for compliance within 30 days. Issues:Appeal against rejection of refund claim, challenge to reduction of refund amount, mistake apparent on record, appealability of adjudicating authority's order, compliance with order dated 15.10.2020.Analysis:The appellant appealed against the rejection of a refund claim by the adjudicating authority, a decision upheld by the Commissioner (Appeals). Following a previous Tribunal order, the appellant filed a refund claim, which was initially approved for Rs. 22,81,472 by the Range officer. Subsequently, the refund amount was reduced to Rs. 2,45,024 due to a discrepancy in the claimed time period. The appellant contended that the original order should be implemented as the subsequent reduction was not challenged before the Commissioner (Appeals). On the other hand, the respondent argued that there was a mistake on record, justifying the reduction, and the order could be amended after notice to the appellant.Upon review, the Member (Judicial) found that the original order dated 15.10.2020, based on the Range officer's recommendation, was appealable and should have been challenged before the Commissioner (Appeals) if aggrieved. As the order was not challenged on these grounds, it was deemed valid. The Member noted that the subsequent order reducing the refund amount was not supported by sufficient legal grounds and was therefore unsustainable. Consequently, the original order dated 15.10.2020 was restored, and the adjudicating authority was directed to comply with it within 30 days.In conclusion, the appeal was allowed, granting any consequential relief, if applicable. The decision was pronounced in an open court setting, emphasizing the restoration of the original refund amount and the necessity for compliance with the order dated 15.10.2020.