Retrospective refund for government construction services allowed where statutory conditions were met and unjust enrichment was addressed by co-applicant treatment.

Retrospective refund relief under Notification No. 09/2016-ST and Section 102 of the Finance Act, 1994 was available for construction services supplied to a Defence department for non-commercial government buildings, where the contract was entered into before 01.03.2015 and the statutory conditions were otherwise met. Technical objections based on contract documentation or stamp duty could not defeat substantive entitlement. The refund was also considered capable of being processed without being barred by unjust enrichment where the service recipient bore the tax burden and was joined as co-applicant, with the matter requiring fresh consideration by the adjudicating authority.

---

---

Issues: (i) Whether construction services provided to Military Engineering Services for government buildings during the relevant period were entitled to refund under the retrospective exemption introduced by Notification No. 09/2016-ST and Section 102 of the Finance Act, 1994; (ii) Whether the refund claim was barred by unjust enrichment and whether the service recipient could be impleaded as co-applicant for processing the refund.

Issue (i): Whether construction services provided to Military Engineering Services for government buildings during the relevant period were entitled to refund under the retrospective exemption introduced by Notification No. 09/2016-ST and Section 102 of the Finance Act, 1994.

Analysis: The exemption framework covered construction services supplied to Government or governmental authorities, and Section 102 provided a retrospective refund mechanism for the period from 01.04.2015 to 29.02.2016 where the contract was entered into before 01.03.2015 and the other statutory conditions were satisfied. The services were rendered to a department of the Ministry of Defence for non-commercial government structures, and the Tribunal followed earlier decisions treating such services as within the ambit of the retrospective relief. The contractual documentation and stamp-duty objection could not defeat the substantive entitlement where the governing statute and notification did not require what was not applicable in law.

Conclusion: The refund claim was held to be maintainable in principle and the assessee was entitled to the claimed refund, subject to reconsideration by the adjudicating authority.

Issue (ii): Whether the refund claim was barred by unjust enrichment and whether the service recipient could be impleaded as co-applicant for processing the refund.

Analysis: The burden of service tax had been borne by the service recipient, and the refund was directed to be processed in a manner that would protect against unjust enrichment by involving the recipient as co-applicant. In the peculiar facts, unjust enrichment was not treated as a bar to the refund, and the matter required reconsideration by the Assistant Commissioner after giving the recipient an opportunity to join the claim.

Conclusion: The bar of unjust enrichment did not defeat the refund claim, and the recipient could be joined as co-applicant for further processing.

Final Conclusion: The impugned order was set aside and the matter was sent back for fresh consideration of the refund claim in accordance with the retrospective exemption and the co-applicant mechanism for the service recipient.

Ratio Decidendi: Where construction services to a governmental department satisfy the conditions of the retrospective exemption under Section 102, the refund cannot be denied merely on a technical objection, and the doctrine of unjust enrichment does not bar relief when the service recipient is the real burden bearer and is brought in as co-applicant.

---