AI Drafter 
TaxTMI 
TaxTMI 
2025 (5) TMI 645
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....as liable to be refunded in terms of sec. 104 of Finance Act, 2017 (FA, 2017). However, it was noticed that the refund application was time barred. Hence Show Cause Notice dated 14.3.2018 was issued to the appellant proposing to deny the entire amount of refund on the ground that the refund claim was filed with a delay of 31 days, beyond the time-limit stipulated under Section 104 of Chapter V of the Finance Act, 1994 ('Act'). After due process of law, the Original Authority rejected the entire refund claim on the ground of time bar. Aggrieved by the said order, the appellant preferred an appeal before the Ld. Commissioner (Appeals), who rejected the appeal on the same ground. Hence the present appeal before this Tribunal. The appellant also has filed a miscellaneous application dated 13.3.2024 seeking to file additional grounds, submitting that premium / development charges are not liable to service tax on renting of immovable property for our consideration. 3. Shri Raghavan Ramabhadra, Ld. Counsel appeared for the appellant and Smt. O.M. Reena, Ld. Authorized Representative appeared for the respondent. 3.1 Shri Raghavan Ramabhadra the Ld. Counsel for the appellant submitted....
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....ction of Section 104 was only to give effect to the principle that the development charges are not liable to service tax, and any amounts collected as service tax were to be refunded. Hence, any amount paid towards service tax under an erroneous belief that the activity was exigible to service tax does not hold the character of 'service tax' and ought to be automatically refunded to the Appellant without subjecting the Appellant to the rigors of filing a refund claim and that the retention of any amounts paid by the Appellant will be without authority of law. He placed reliance on the below decisions for the proposition that amounts collected without the authority of law, cannot be subject to the statutory rigors of limitation: E) S. Sakthikumar vs. CCE, Madurai - 2022 (61) G.S.T.L. 364 (Tri. - Chennai) (paragraph 6). F) PKF Sridhar & Santhanam LLP vs. CCE - 2022 (58) G.S.T.L. 423 (Tri. - Chennai) (paragraph 7). G) Wolkem India Limited vs. Commissioner of Customs, Tuticorin - 2019 (368) E.L.T. 1090 (Tri. - Chennai) (paragraphs 8.1, 8.2). H) Mera Baba Realty Associate (P) Ltd. vs. CST - 2017 (49) S.T.R. 257 (Del.) (paragraph 9). He stated that ....
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....ligible to be refunded as sub-section (1) of Section 104 retrospectively exempted the service tax leviable on the said development charges during the period starting with 1-6-2007 to 21- 9-2016 (both days inclusive). The said Finance Act inserting the above section 104 received assent of the President of India and become effective from 1.4.2017. Whereas the assessee has filed refund claim of Rs.1,79,46,788/- on 31.10.2017 which is beyond 6 months' time limit prescribed under Sec.104(3) and, hence, hit by time bar. i.e. the last date to file the present Refund claim of Rs. 1,79,46,788/- is 30.09.2017, whereas the assessee has filed the Refund claim on 31.10.2017 i.e. beyond the time limit, which attracts time bar, hence it appears that the assessee is not eligible for refund due to time bar. 4. As per the claim of the assessee, they have paid service tax to SIPCOT and in tum SIPCOT paid Service Tax to the Department. Whereas the assessee did not furnish any evidence proving that the said service tax not passed to anyone and that 'unjust enrichment' is not applicable in their case." 4.1 The OIO dated 19.07.2018, while accepting that the rule of unjust....
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....and therefore, the appellant cannot refer to Section 11B of the CEA, 1944 as Section 104 is a special provision providing for a relief to the persons who have allotted industrial plots either on long term lease or otherwise. 9. Regarding the contention of the appellant that they had provided bonafide reasons for the delay in filing of refund application, I agree with the impugned order that the stated reasons are not valid grounds for delay in filing of the claim. In respect of the case laws cited by the appellant I find that the original authority has countered all these citations and came out with a reasoning how the same could not be made applicable in the instant case which is found acceptable. 10. In view of the above, I do not find any infirmity in the impugned order and find that the appeal is liable for rejection." The appellant before us, has prayed that the impugned order dated 28.12.2018 may be set aside with consequential relief. 4.2 We find that the appellant has not contested that there has been a delay in filing the refund claim. Their main plea is; i) The claim should have been filed by SIPCOT who had deposited the service tax with t....
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....f Rs.4,49,564/- to the Trust and in support of their claim of subject refund, they have furnished a challan of the Trust showing the payment of Service Tax of Rs.4,39,055/- to the Government account. It is quite clear that the Appellant had not paid the tax to the Government account, in relation to which he is seeking refund and he has no locus standi to file the refund claim in terms of section 11B(1) (emphasis added) 5.2 Section 11B(1) of the CEA 1944, which pertains to the claim for refund of duty and interest, states that 'any person' claiming refund of any duty of excise and interest, if any, paid on such duty may make an application for refund to the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise before the expiry of one year from the relevant date in such form and manner as may be prescribed. The expression "any person" is of wide amplitude. The Act thus does not confine a claim of refund only to the person who has collected and deposited the tax in the government coffers. However, section 12B of CEA 1944, contains an important presumption that needs to be overcome before sanction of refund to an applicant. 5.3 As per sect....
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....acturer. Another submission which remains to be considered is the requirement of verification to be done for the purpose of finding out who ultimately bore the burden of excise duty. It might be difficult to identify who had actually borne the burden but such verification would definitely assist the Revenue in finding out whether the manufacturer or buyer who makes an application for refund are being unjustly enriched. If it is not possible to identify the person/persons who have borne the duty, the amount of excise duty collected in excess will remain in the fund which will be utilized for the benefit of the consumers as provided in Section 12-D." (emphasis added) 5.6 From the discussions above, it is clear that it is the appellant who has borne the ultimate incidence of the tax, and not the Trust, who is the eligible claimant of the refund and is not barred from claiming the same. Further the question of unjust enrichment also does not arise as the amount has been paid from the appellants own resources and has not been shown to have been passed on. The appeal on this issue hence succeeds. 5.1 The legal position that a consumer of goods (which now includes services) co....
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....on of time limit in the section otiose. Unscrupulous / clever applicants for refund or those indolent towards their rights could always pass of the delay as having been caused due to the time taken in waiting for certain documents / certificate from third parties who are not performing any official duty. For example, a certificate for the nonuse of the duty paid towards availing credit or reversing credit etc. from the next stage buyer / consumer or a Chartered Accountant. Statutory timelines are not to be circumvented in a manner allowing unscrupulous / clever applicants to seek concessions or those who have slept over their rights to revive stale claims, at a later date. Further the appellant in their written submission refers to delay in filing the claim as an 'administrative delay' by SIPCOT. There is nothing to show that the delay was administrative in nature, by way of any official / departmental impediment. The use of the colourable term appears to be meant to seek an advantage by clothing a delay as an official one and which is covered by judgments of Constitutional Courts. More so, they have not shown any letters / correspondences made by them to SIPCOT urging them to pay ....
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....taxing statute has to be interpreted in the light of what is clearly expressed. The Court cannot imply anything which is not expressed. Moreover, the Court cannot import provisions in the statute to supply any deficiency; h. There is nothing unjust in the taxpayer escaping if the letter of the law fails to catch him on account of the legislature's failure to express itself clearly; i. If literal interpretation is manifestly unjust, which produces a result not intended by the legislature, only in such a case can the Court modify the language; j. Equity and taxation are strangers. But if construction results in equity rather than injustice, such construction should be preferred; k. It is not a function of the Court in the fiscal arena to compel the Parliament to go further and do more; l. When a word used in a taxing statute is to be construed and has not been specifically defined, it should not be interpreted in accordance with its definition in another statute that does not deal with a cognate subject. It should be understood in its commercial sense. Unless defined in the statute itself, the words and expressions in a taxing statute have....
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.... below; 16. Article 265 of the Constitution is declaratory in nature. It says that "no tax shall be levied or collected except by authority of law". This no doubt means that taxes collected contrary to law have to be refunded. But where a taxing enactment contains provisions providing for and governing the refund of taxes collected without the authority of law, the validity of such provisions, if and when questioned, has to be examined with reference to other provisions of the Constitution. Article 265 does not itself lay down any criteria for testing the validity of a statute. When it speaks of "law", it no doubt refers to a valid law but the validity of a law has to be determined with reference to other provisions in the Constitution. *****. *****. ***** 21. With respect to the second category of cases, there is a good amount of controversy. While the Union of India says that such claims of refund should be put forward and determined only under and in accordance with the provisions of the Act and the Rules, the contention of the appellants-petitioners is that even in such cases a suit or writ is maintainable on the ground that the tax has been collected....
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....11 and 11B are complimentary to each other. To such a situation, Proposition No. 3 enunciated in Kamala Mills becomes applicable, viz., where a statute creates a special right or a liability and also provides the procedure for the determination of the right or liability by the Tribunals constituted in that behalf and provides further that all questions about the said right and liability shall be determined by the Tribunals so constituted, the resort to civil court is not available - except to the limited extent pointed out therein. Central Excise Act specifically provides for refund. It expressly declares that no refund shall be made except in accordance therewith. The Jurisdiction of a civil court is expressly barred - vide sub-section (5) of Section 11B, prior to its amendment in 1991, and sub-section (3) of Section 11B, as amended in 1991. It is relevant to notice that the Act provides for more than one appeal against the orders made under Section 11B/Rule 11. Since 1981, an appeal is provided to this Court also from the orders of the Tribunal. While Tribunal is not a departmental organ, this court is a civil court. In this view of the matter and the express and additio....
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....be unconstitutional for violation of any of the constitutional limitations. This is a situation not contemplated by the Act. The Act does not contemplate any of its provisions being declared unconstitutional and therefore it does not provide for its consequences. Rule 11/Section 11B are premised upon the supposition that the provisions of the Act are good and valid. But where any provision under which duty is levied is found to be unconstitutional, Article 265 steps in. In other words, the person who paid the tax is entitled to claim refund and such a claim cannot be governed by the provisions in Rule 11/Section 11B. The very collection and/or retention of tax without the authority of law entitles the person, from whom it is collected, to claim its refund. A corresponding obligation upon the State to refund it can also be said to flow from it. This can be called the right to refund arising under and by virtue of the Constitutional provisions, viz., Article 265. But, it does not follow from this that refund follows automatically. Article 265 cannot be read in isolation. It must be read in the light of the concepts of economic and social justice envisaged in the Preamble and the guid....
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....a statute by misconstruction or wrong interpretation of the provisions of the Act, Rules or Notifications or by an erroneous determination of the relevant facts, i.e., an illegal levy. In this class of cases, the claim for refund arises under the provisions of the Act. In other words these are situations contemplated by and provided for by the Act and the Rules. [See para 18 of judgment] 7.2 However, all refund claims except that of an unconstitutional levy must be filed and adjudicated under the refund provisions of the Central Excises and Salt Act 1944 (as made applicable in Service Tax matters also) or the Customs Act 1962, as the case may be. 7.3 It is also noticed that a Larger Bench of this Tribunal in Veer Overseas Ltd. v. CCE, Panchkula decided on 27 March, 2018, [2018 (4) TMI 910 - CESTAT Chandigarh] heard the following reference; "(a) Whether in respect of the claim for refund of illegal levy of Service Tax or of Service Tax collected without authority of law, the statutory time limit prescribed in terms of Section 11B of Central Excise Act 1944 will be applicable or not?". The majority of two Members discussed the Mafatlal Judgment and held that the sta....
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....ount is collected as Service Tax and is deposited to Government any refund can be claimed only as per the provisions of the said Act. As stated in the Mafatlal industries judgment (supra), even a finding regarding the invalidity of a levy need not automatically result in a direction for a refund of all collections thereof made earlier. 8. As per Section 17(1)(c) of the Limitation Act, the period of limitation in an application filed for obtaining relief from the consequences of a mistake would begin from the moment the applicant has discovered the mistake 8.1 The Finance Act 1994, is a self-contained Code exhaustive of the matters dealt with therein. The purpose of the Act is to levy a tax on service, assess and collect the same. It follows, therefore, that all the provisions contained in the Act have been designed with the object of achieving that purpose. We find that the Hon'ble Supreme Court in Sakuru Vs Tanaji [AIR 1985 SUPREME COURT 1279], examined the applicability of the Limitation Act 1963, before bodies other than Courts such as quasi-judicial Tribunals or executive authorities. It held: 3. After hearing both sides we have unhesitatingly come to the conclus....
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....eriod of limitation are contained in Ss. 12 to 24 included in Part III of the Limitation Act, 1963. Section 5 is not a provision dealing with 'computation of the period of limitation'. It is only after the process of computation is completed and it is found that an appeal or application has been filed after the expiry of the prescribed period that the question of extension of the period under S. 5 can arise. We are, therefore, in complete. agreement with the view expressed by the Division Bench of the High Court in Venkaiah's case that S. 93 of the Act did not have the effect of rendering the provision of Sec. 5 of the Limitation Act, 1963 applicable to the proceedings before the Collector. 8.2 Again a three Judge Bench of the Supreme Court in COMMISSIONER OF CUSTOMS AND CENTRAL EXCISE Vs M/s HONGO INDIA (P) LTD [2009-TIOL-48-SC-CX-LB], examined the issue of the Limitation Act being applicable to Central Excise matters. The Hon'ble Court held; 20) Though, an argument was raised based on Section 29 of the Limitation Act, even assuming that Section 29(2) would be attracted what we have to determine is whether the provisions of this section are expressly exc....