Revenue cannot adopt inconsistent positions on identical service tax refund claims without legal changes

CESTAT Mumbai allowed appellant's appeals by remand in a service tax refund case involving export of advertising agency services. The tribunal found that revenue authorities had inconsistently rejected refund claims for identical services after previously granting refunds for the same period (April 2011-June 2012) without showing any change in law. The tribunal emphasized that revenue cannot adopt inconsistent positions in subsequent assessments with identical facts unless law has changed. Matter was remanded to Adjudicating Authority for fresh consideration of earlier refund orders and applicable laws, with proper hearing opportunity for appellant.

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Issues:
1. Whether the services provided by the appellant to overseas group companies qualify as export of service for service tax refundRs.
2. Whether the refunds claimed are affected by the doctrine of unjust enrichmentRs.

Issue 1:
The appellant claimed service tax refunds for providing Advertising Agency Services to overseas group companies, arguing it qualifies as export of service under Rule 6A of Service Tax Rules, 2012. The Adjudicating Authority rejected the claims, stating the services were intermediary services and not eligible for refund. The appellant contended that they provided services on a principal-to-principal basis and not as intermediaries, as they interacted directly with the overseas group company's clients. The issue of unjust enrichment was also raised. The Tribunal noted the inconsistency in the Adjudicating Authority's previous refund orders for the same services. Citing legal precedents, the Tribunal remanded the matter back to the Adjudicating Authority for a fresh decision, considering the earlier refund orders and relevant laws.

Issue 2:
The Tribunal highlighted the importance of consistency in decisions and referred to legal principles regarding res judicata. It noted that the nature of services provided by the appellant remained unchanged, and the authorities failed to justify rejecting the refund claims based on any change in law or circumstances. The Tribunal emphasized the need for the Adjudicating Authority to re-examine the case, considering all submissions and applicable laws at the relevant time. The Tribunal set aside the impugned order and allowed the appeals by remanding the matter for fresh adjudication.

This judgment addresses the issues of export of service eligibility and unjust enrichment concerning service tax refunds claimed by the appellant for providing Advertising Agency Services to overseas group companies. The Tribunal emphasized the importance of consistency in decisions and remanded the matter back to the Adjudicating Authority for a fresh decision, considering past refund orders and relevant legal principles.

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