2010 (2) TMI 134 - AT - Service Tax

Appellants entitled to file refund claim without challenging assessment. Member emphasizes lack of challenge to assessment order.

The appellants were allowed to file a refund claim without challenging the assessment. The Member (Judicial) emphasized that since no order or decision by ... Refund claim after self-assessment - appealability of self-assessment - requirement to challenge adjudicating authority's order before refund - no order/no decision - refund admissibleRefund claim after self-assessment - appealability of self-assessment - no order/no decision - refund admissible - Whether appellants who paid service tax by self-assessment can file a refund claim without first challenging any assessment order by the adjudicating authority - HELD THAT: - The appellants had paid service tax on their own volition and filed ST-3 returns; there was no adjudicating order or decision by a Central Excise officer assessing or determining liability. The authorities rejected the refund claim by applying the rule in Flock (India) Ltd. and related decisions which concerned cases where an assessing officer had passed an order that remained unchallenged. Those precedents are distinguishable because they involved an order capable of appeal. This Tribunal held, in consonance with earlier decisions of this Tribunal, that self-assessment is not an order or decision by a subordinate adjudicating authority and therefore is not appealable to the Commissioner (Appeals). Where no order or decision by the officer exists, the requirement to challenge an assessment order before claiming refund does not arise, and the insistence on preferring an appeal against self-assessment is erroneous. Applying these principles to the facts, the appellants were entitled to pursue the refund claim since there was no adjudicating order to be challenged. [Paras 2, 6, 7]Impugned rejection of the refund claim set aside and appeal allowed as no adjudicating order existed requiring challenge before claiming refund.Final Conclusion: The Tribunal allowed the appeal, set aside the impugned order rejecting the refund claim, and held that where tax is paid by self-assessment and no order/decision by the adjudicating authority exists, the assessee need not first challenge an assessment order before claiming a refund. Issues involved:Whether the appellants can file a refund claim without challenging the assessmentRs.Analysis:The case involves the appellants providing Business Auxiliary service to a company and paying service tax on commission received before a policy change. Post-policy change, they filed a refund claim, rejected by lower authorities citing the decision in CCE, Kanpur Vs. Flock (India) Pvt. Ltd. The main issue is whether the appellants can file a refund claim without challenging the assessment. The appellant's advocate argued that as no order was passed by an adjudicating authority, they were not required to file an appeal. She distinguished cases like Flock (India) Ltd. and Priya Blue Industries Ltd. where assessments/orders were challenged before filing refund claims. The advocate cited precedents like Central Office Mewar Palace Org. Vs. Union of India to support the argument that without an appealable order, a refund claim can be filed. On the contrary, the Departmental Representative contended that since the self-assessment was accepted without challenge, the refund claim was not maintainable, aligning with the Flock (India) Ltd. decision.The Member (Judicial) analyzed the case, emphasizing that no order or decision by the Central Excise officer was challenged, making the question of challenging the assessment irrelevant. The Member noted that the appellants paid service tax on their own assessment and filed a refund claim upon realizing their non-liability. Citing Nagpur Transwell Power Pvt. Ltd. case, the Member clarified that the appeal under Section 35F of the Central Excise Act is against orders/decisions by subordinate officers, not self-assessment. Precedents like M/s Gimatex Industries Pvt. Ltd. were referenced to support the view that the law does not provide for an appeal against self-assessment. Ultimately, the Member concluded that as there was no order or decision to challenge, the appellants were not entitled to file an appeal against their own assessment. Consequently, the impugned order was set aside, and the appeal by the appellants was allowed.