TaxTMI 
TaxTMI 
2014 (7) TMI 891
X X X X Extracts X X X X
X X X X Extracts X X X X
....g been allowed, the refund claim of the assessee in respect of certain tax amounting to Rs. 16,99,714/- under Section 11B of the Central Excise Act, 1944 has been granted. The revenue has raised two questions of law in the appeal, which read as follows: "I. Whether the Hon'ble CESTAT has erred in allowing the refund, without considering provisions of limitation provided in Section 11B of the Central Excise Act, 1944? II. Whether the Hon'ble CESTAT has erred in allowing the refund, without considering provisions of unjust enrichment provided in Section 11B of the Central Excise Act, 1944? The assessee purchased natural gas through a pipeline from Reliance Gas Transportation Infrastructure Ltd. (RGTIL). The transmission ch....
X X X X Extracts X X X X
X X X X Extracts X X X X
..... However, an appeal was filed by the revenue which was allowed by the Commissioner (Appeals), Meerut on 16 April 2012. The Commissioner (Appeals) reversed the order of the adjudicating authority only on the ground that the refund claim was filed by the recipient of the service and not by the service provider and that the expression "any person" in Section 11B of the Central Excise Act, 1944 does not include the recipient of the service. The assessee filed an appeal before the Tribunal. The Tribunal by the impugned judgement and order dated 5 December 2013 followed the decision of a Constitution Bench of the Supreme Court in Mafatlal Industries Ltd. vs. Union of India1 and held that the claim for refund of excess service tax paid was mainta....
X X X X Extracts X X X X
X X X X Extracts X X X X
....y Section 11B. As a matter of fact, the grounds would indicate that the principle, if not the only challenge on the part of the revenue was that the assessee, which was a recipient of the service and not the service provider, was not entitled to file a refund claim under Section 11B. The case of the revenue was that it was the service provider, namely RGTIL which alone was entitled to file a claim before the Commissionerate concerned and RGTIL had recovered the service tax amount from various recipients. This contention was accepted by the Commissioner (Appeals). The assessee filed an appeal before the CESTAT. No cross objections were filed by the revenue. Hence, the record would indicate that the finding of the adjudicating authority to....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the Tribunal has allowed the refund without considering this aspect. On this aspect, it would, at the outset, be necessary to note that a finding of fact was entered by the Assistant Commissioner, Bareilly to the effect that the final product urea which is manufactured by the assessee, which was the recipient of the service, is exempted from payment of excise duty and the value of the fertilizer is fixed by the State. Hence, it has been held that the burden of duty had been borne by the assessee as a service recipient and the question of unjust enrichment did not arise. As we have noted earlier, the Commissioner (Appeals) reversed this finding holding that it is only the service provider, namely RGTIL which could have filed a refund ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d it is only that person who can legitimately claim its refund. But where such person does not come forward or where it is not possible to refund the amount to him for one or the other reason, it is just and appropriate that the amount is retained by the State, i.e., by the people. There is no immorality or impropriety involved in such a proposition..." The Tribunal was clearly, in our respectful view, correct and justified in following this principle. The assessee is the recipient of the taxable service provided by RGTIL and had borne the incidence of service tax. Hence, the assessee is entitled to claim a refund of excess service tax paid consequent upon the downward revision of the transmission charges payable by the assessee to RGTIL....