2024 (8) TMI 323

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.... the appellant has refunded the additional charges recovered for transportation of goods through pipeline by way of credit notes. The appellant have filed refund claim of Rs. 88,47,107/- of the additional service tax paid by them on the additional charges recovered by them from their customers. The department has issued show cause notice dated 03.02.2010 as to why the refund claim of service tax paid by them under the category of Business Auxiliary Service should not be rejected as they have already recovered service tax amount paid by them from their APM (Administered Price Mechanism) Gas customers and therefore the service tax has rightly been paid by them. The Adjudicating Authority by the impugned order-in-original dated 04.03.2010 rejected the refund claim of the appellant. The appellant have approached the Commissioner (Appeals) against the impugned order-in-original however they did not succeed at the appeal level also and the learned Commissioner (Appeals) vide its order dated 22.08.2013 rejected the appeal of the appellant. 2. Shri JC Patel, learned advocate appearing on behalf of the appellant has submitted that appellant was engaged in the activity of supplying gas th....

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....id by the service provider. 2.2 The learned advocate has argued that the issue has been settled in various judgments of this Tribunal that service tax paid on the additional charges which has been refunded to the customer is liable to be refundable to the service provider. The learned advocate has relied upon the following decisions in this regard :- (a) Piramal Enterprises Limited v CST-2016 (42) STR 17 (b) Edelweiss Securities Limited v CST-2016 (44) STR 429 (c) Hexacon (India) Limited v CCE-2003 (156) ELT 357 (d) Chambal Fertilizers & Chemicals Limited v CCE-2016 (4) TMI 845. (e) CCE v Indian Farmers Fertilizers Co-op Limited-2014 (35) STR 492 (All) (f) GAIL (India) Limited v CCE - 2016 (46) STR 698 (g) Order-in-original No. 82/09-10/DC/ST/REF/Agra in appellant's own case granting refund. 3. We have heard Shri Himanshu P Shrimali, learned Superintendent (AR) who has reiterated the findings as given in the impugned order-in-appeal and order-in-original. 4. Having regard the rival submissions we find that there is no denying of the fact that appellant have issued credit notes to its customers for the additiona....

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....ur and that such occurrence is recorded through the medium of credit and debit notes. It is apparent from the records of the instant case that the two entities are part of the same group and hence adoption of this mode of settlement is acceptable as sufficient evidence of compensation for services rendered. The charges levied from M/s. Nicholas Piramal India Ltd. by the appellant are amply evident in the debit notes pertaining to the quarter April, 2007 and September, 2007. It cannot but be accepted that the credit note issued in October, 2007 is intended to reduce the amounts payable by the client to the appellant to the extent of Rs. 2,93,50,000/-. The contention of the learned Chartered Accountant that any payment can be released only after withholding of tax deducted at source is borne out by the lesser amounts entered in the ledger and the bank statements. We find no flaw in this contention and there is no counter by Revenue that can contest this. 9. We also note that the decisions of the Tribunal cited by the learned Chartered Accountant clearly bring out the judicial pronouncements by which the bar of unjust enrichment will not operate even if the transactions are b....

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....ad already refunded such amount to the person from whom it was received or had not collected at all. It is not the finding of the lower authorities that appellants have not refunded the amount. The issue of credit note/debit note is a standard practice and accepted practice in accounting terminology for deciding liability or claim for refund. In such a situation issue of credit note would be sufficient unless there is a clear finding that the amount has not been refunded by Poornima to the clients, unjust enrichment clause cannot be invoked. In view of the precedent decisions of the Tribunal which have been rendered in respect of Service Tax and the clarification of the Board, we hold that unjust enrichment is not applicable." 6. The case laws relied upon by the ld. AR are either pertaining to Central Excise refund claims or are pertaining to the period before the above interpretation made by CESTAT, Ahmedabad Bench. In view of the above, it is held that the appeal filed by the appellant is squarely covered by the law laid down by this Bench in the case of CST, Ahmedabad v. Poornima Advertising & Promotion Pvt. Ltd. (supra)." (c) Similar view has also been taken b....