TaxTMI 
TaxTMI 
TaxTMI 
2024 (6) TMI 87
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.... free of cost. On receipt of a certificate regarding cement and steel supplied free of cost, the appellant raised supplementary invoices on Unitech and Vatika on the supply of cement and charged service tax by way of abundant precaution as according to the appellant service tax was not leviable on the material supplied free of cost. On receipt of the invoices from the appellant, both Unitech and Vatika paid service tax, which the appellant deposited with the service tax department. 3. A show cause notice dated March 07, 2007 was served upon the appellant requiring the appellant to show cause why service tax amount of Rs. 1,23,70,024/- paid by the appellant on the value of steel and cement supplied to the appellant free of cost should not be appropriated against the service tax liability. The appellant filed a reply and denied the allegations but by an order dated March 23, 2009 the Commissioner of Central Excise confirmed the demand. 4. Feeling aggrieved, the appellant filed an appeal before the Tribunal and the Tribunal by order dated 23.07.2014 allowed the appeal. The order is reproduced below: " The assessee is in appeal against the adjudication order dated 23.3.2009 passed ....
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....17-B, I.P.Estate, IAEA House, New Delhi vide their letter No. C. No. IV(16) HQ /ST /Tech /95/Misc/2014/ 18673 dated 13.08.2014 have directed us to get in touch with you, the appropriate authority, for the issue of the refund of Rs. 1,23,70,024/- as held per order dated 23.07.2014 of the Hon'ble CESTAT, the copy of the letter No. C. No. IV (16) HQ /ST /Tech/ 95/ Misc / 2014 Misc/ 2014/18673 dated 13.08.2014 enclosed for your ready reference. We would be grateful if the refund of Rs. 1,23,70,024/-may kindly be issued at the earliest." 6. On receipt of the application, the Superintendent (Refund) sent a letter dated 25.08.2014 to the appellant pointing out why the said letter cannot be treated as a refund application. The reasons stated are as follows: 1. Application as per section 11B of Central Excise Act, 1944 read with section 83 of Finance Act, 1994. 2. On Line Refund Request is not submitted. 3. Certified copy of the ST-2 Certificate. 4. ST-3 return for the relevant period with challan deposited. 5. Certificate from your Statutory Auditor certifying that the burden of Service Tax, which is claimed as refund, has not been passed on to any other person. 6. Certi....
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....entral Excise Act, 1944, as made applicable to Service Tax. I find that the said payments were made after raising the invoices upon the parties and recovering Service Tax from the said parties. However, the claimant has stated that they have credited their clients with the amount of Service Tax, claimed as refund. The claimant had recovered the said amount of Service Tax from their clients in the year 2006- 07. Their clients are not individual consumers but Real Estate Developers. There is no evidence adduced to show that the said clients of claimant had not passed on the burden of said Service Tax on their customers, directly or indirectly. In such situation, I find that the grant of refund to the claimant will certainly amount to 'unjust enrichment' in terms of Section 11B of the Central Excise Act, 1944." (emphasis supplied) 9. Feeling aggrieved, the appellant filed an appeal before the Commissioner (Appeals). The Commissioner (Appeals) upheld the order passed by the Assistant Commissioner for the following reasons: 9. The appellants had received the said amount of service tax from their clients i.e. Unitech & Vatika for the concerned period after raising invoices. Appella....
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....all, instead of being credited to the Fund, be paid to the applicant, if such amount is relatable to - (d) the duty of excise and interest, if any, paid on such duty paid by the manufacturer, if he had not passed on the incidence of such duty and interest, if any, paid on such duty to any other person; Refund of duty, therefore, should be paid to the customers who have ultimately borne the burden of tax. And since it is practically not feasible to identify such customers on individual basis, such refund has to be credited to Consumer Welfare Fund. 10. Shri Srinivas Kotni assisted by Shri Akshay Kumar, learned counsel for the appellant submitted that the Commissioner (Appeals) committed an error in ordering the amount sanctioned to be deposited in the Consumer Welfare Fund. Learned counsel pointed out that though the appellant may have initially collected the service tax from Unitech and Vatika, but after the order was passed by the Tribunal the appellant issued a Credit Note in favor of Unitech and Vatika. It is, therefore, the contention of the learned counsel for the appellant that the burden of service tax was borne by the appellant and in terms of the directions issued by ....
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....e that contained a stipulation that the amount would actually be paid to Unitech and Vatika only when the department refunds the amount to the appellant. The certificate does not even specify why the appellant would not unjustly enriched. 15. In any view of the matter, even if it is assumed that such credit was done by the appellant in the books of accounts in favour of Unitech and Vatika, there is nothing on the record even in this appeal to substantiate that Unitech and Vatika had not collected service tax from the allottees to whom they had allotted the flats. This is what prevailed upon the Assistant/Deputy Commissioner to hold that refund should be credited in the Consumer Welfare Fund. Once such a finding was recorded by the Assistant Commissioner, it was incumbent upon the appellant to have at least filed sufficient evidence before the Commissioner (Appeals) to substantiate that these two builders had not recovered service tax from the allottees. 16. There is no error in the Assistant Commissioner assuming, in the absence of any evidence led by the appellant, that the two builders had recovered service tax from the allottees of the flats and so they would be unjustly enric....