TaxTMI 
TaxTMI 
2025 (7) TMI 1711
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.... the Assistant Commissioner, Rampur, vide order dated 22.03.2010, rejected the refund claim. On an appeal preferred by the appellants, learned Commissioner (Appeals), vide impugned order dated 23.08.2008, upheld the rejection order passed by the lower authority. Hence, this appeal. 2. Learned Counsel Shri R.K. Phillips and Shri Apoorva Phillips, Advocates for the appellants, reiterate the grounds of appeal and submit that the Appellate Authority failed to distinguish between the services covered under "Erection, Commissioning, or Installation and services covered under "Works Contract''; both the authorities displayed, preconceived notion by observing that the impugned contract is a contract for "erection, commissioning, or installation services" and there is no reason to discuss the provisions of the "Works Contract Rules, 2007; definition of the "Works Contract" includes Contract for carrying out erection, commissioning or installation. He submits that the service of 'Erection Commissioning or Installation' and 'Works Contract Service' are different; 'Erection Commissioning or Installation' does not involve any transfer of property. The appellant has provided a 'works contract....
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.... and consistently held that the procedural infractions can be condoned; unduly restricting the scope of a beneficial provision to be avoided so that it may not take away with on hand what the policy gives with the other; it is the duty of the authorities to grant such benefits if the Appellant is entitled. He relies on • UOI Vs Suksha International & Nutan Gems & Anr. [1989 (39) ELT 503] • UOI VS. A. V. Narsimhalu [1983 (13) ELT 1534] • Mangalore Chemicals & Fertilizers Ltd 1991 (55) ELT 437 (SC) • M/s. Share Medical Care 2007 (209) ELT 321 (SC) • Indian Petro Chemicals 1997 (92) ELT 13 (SC) • HCL Ltd 2001 (130) ELT 405 (SC)) • TATA Oil Mills Ltd 1989 (43) ELT 183 (SC) 6. Learned Counsel submits that the appellate authority has wrongly rejected the refund claim on the grounds that the appellant has failed to exercise the option under Rule 3(3) of the works contract (Composition Scheme for payment of service tax) Rules 2007; exercising the option is a mere procedural and the same should not take away the substantial benefit that is due to the appellant; as no fixed format have been prescrib....
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....m; the original authority as well as the first appellate authority have correctly held that the services provided by the appellant do not fall under the category of 'Works Contract Service' and fall under 'Erection Commissioning & Installation' and therefore, service tax was correctly paid and there is no scope for any refund. Learned authorized representative further submits that the appellant though stated, vide letter dated 02.03.2009, that they have submitted at document evidencing payment of service tax i.e. RG-23A part II Register, they have not submitted the same. Learned Counsel at this Juncture counters the argument stating that this point was not taken in OIO and OIA. 9.1. Learned authorized representative further submits that in the present case appellant has paid service tax on the basis of self-assessment and filed ST-3 Returns also; these ST-3 Returns were neither revised nor appealed against at any point of time to the concerned appellate authority for modification of the self-assessment made. As held by the various courts and tribunals, refund is only an executionary mechanism and unless the assessment originally made is challenged and modified by the appellate a....
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....ed under the category of Works Contract Services and classifiable as per the category of "Erection Commissioning & Installation Services". The payment of service tax as per the provision of law prevailing at the relevant time. 12. On hearing the rival contentions and on-going through the records of the case, we find that the issues that require our consideration in the impugned case are as follows. (i). Whether the services rendered by the appellants can be categorised under 'Works Contract service' (ii). Whether the appellants are eligible to avail the composition scheme under 'Works Contract'? whether the non-exercising of option is a condonable procedural lapse; would it disentitle the appellants from a substantial right? (iii). Whether the refund claim is maintainable without challenging the self-assessment? 13. The first issue to be decided is as to whether the service rendered by the appellants falls under 'Work Contract'. On going through the records of the case like the contract, invoices etc, it is clear that the work entrusted to the appellant was inclusive of material. The appellants have paid applicable sales Tax/VAT at the rate of 12.5%. These facts are ....
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....te such problems. After the introduction of the service, indivisible contracts, which could have been otherwise classified under other heads earlier, had to be classified under this heading only. Hon'ble Apex Court in the case of Larsen and Toubro went to the extent of holding that such indivisible contracts could not have been held exigible to Service Tax before 1.6.2007. Therefore, we are of the considered opinion that the services rendered by the appellant fall under 'Works Contract Service'. 15. Now, we turn our attention to the second issue as to whether the appellants are eligible to avail the composition scheme under 'Works Contract' and as to whether the non-exercising of option is a condonable procedural lapse and non-filing the option would disentitle the appellants from a substantial right. We have to see whether the appellants have followed the conditions laid down Works Contract (Composition Scheme for Payment of Service Tax) Rules, 2007. A perusal of the Rule 3, gives us an understanding that the said Rules lays down the three conditions that (i). The provider should file the option to pay service tax under this category prior to payment of service tax.(2) the prov....
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....at credit earned against the inputs alone; the fact is accepted in the Show Cause Notice itself. We find that it is clearly mentioned in the show cause notice, at para 4, that the noticee paid service tax of Rs.87,02,232/- in the month of March 2008 on the aforesaid advances by utilizing the CENVAT Credit in respect of input services. Further, on the direction of the Bench, the appellants submitted an affidavit to the effect that (i) that as per the records available, the company has paid the Service Tax amounting to Rs.87,02,232/- through Debit in RG-23A Part II (maintained for input Services) vide Entry No. 3424 dated 31.03.2008,(ii) that the sum deposited as Service Tax amounting to Rs.87,02,232/- inadvertently on the receipt of advance of the total sum of Rs.7,04,05,604/-(iii) that the duty/tax has been paid through credit maintained for the input Services and copy of the RG-23A Part-II is not readily available. 18. In view of the above discussion, we find that the services rendered by the appellant fall under the 'Works Contract service'. The fact that the appellants paid VAT in respect of the services rendered by them is not denied. They have recovered Service Tax from the....
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....ioning or Installation and for the disputed period i.e. 2008-09 to 2009-10, the activity will also be covered under the category of Works Contract Service (WCS) which was introduced in the statute w.e.f. 01/06/2007, Under the WCS, the benefit of payment of Service Tax under the Composition Scheme was notified vide Notification No. 32/2007 ST: MANU/DSTX/0054/2007 dated 22/05/2007. The notification provides that the service provider is required to opt for payment of Service Tax under the Composition Rules prior to payment of Service Tax in respect of the Works Contract. But on perusal of the record of the present case we note that the appellant has opted for such Composition Scheme after they started making payment of Service Tax under the Works Contract Scheme. For the sole reason-for-failure to file the intimation prior to payment of Service Tax under WCS, the Adjudicating Authority has denied the benefit of Composition Scheme. 18.3. Tribunal, in the case of ABL Infrastructure Pvt Ltd. (supra). considering a similar issue, observed that a substantial benefit cannot be denied for procedural deficiency of delay in opting for Works Contract Service by a specific declaration under R....
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....her. To decide therefore, on which side of the line a case falls, the broad resemblance to another case is not at all decisive." 20. Now, we turn our attention to Coming to the last issue, rather a legal one, arising due to the submission of the Learned Authorised Representative, that the appellants should have appealed against the self-assessment, made by them in the ST-3 returns; refund cannot be sanctioned unless the assessment is modified by a competent authority, by due process of Law. Revenue relies on the decision of Hon'ble High Court of Delhi in the case of BT (India) Private Limited [2023-VIL-770-DEL-ST]. Hon'ble High Court has held that the decision of ITC Ltd, is applicable in the case of service tax also and without modification of the self-assessment made the refund claim cannot be allowed. Hon'ble Delhi High Court held as below. 66. In our considered view, unless the self-assessed return, as submitted had been questioned, re-opened or re-assessed and the assertion of the petitioner of the services rendered by it qualifying as an 'export of service' questioned or negatived in accordance with the procedure prescribed under the Act, its claim for ref....
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.... Hon'ble Supreme Court held, in the case of Salonah Tea Company Ltd Etc. Vs. Superintendent of Taxes, Nowgong & Ors 1988 (33) ELT 249 (SC), that State is liable to refund of tax collected without the authority of law. 23. We find that Revenue attempts to rely on ITC Ltd, contending that the appellant did not get the self-assessment nullified or modified, in accordance with the procedure prescribed under the relevant statute, the assessment cannot be questioned in the refund proceedings, as refund proceeding are only executionary in nature; that is to say that unless the self-assessment is appealed against there can be no question of refund. We find that the issue was not raised in the Show Cause Notice. It was not considered to be applicable by the Assistant Commissioner (Original Authority) or Commissioner (Appeals) the (Appellate Authority). They have not examined this issue and have not given any findings on this issue. The Department has also not filed any cross appeal in this appeal to raise the issue. 24. We find that it has been held in a catena of judgements that the Revenue cannot raise this issue at this stage as the same was not part of the proceedings either in th....
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....n favour of Revenue a case which Revenue never canvassed and which the assessee was not required to meet. In case of Gujarat State Fertilizers Co. v. Collector of Central Excise - 1997 (91) E.L.T. 3 (S.C.) again the Hon'ble Apex Court held. "It is difficult to appreciate as to how the CEGAT could go to that conclusion when it was not called upon to go into the question by either of the parties before it. The only contention before CEGAT was whether the term "Fertilisers" in each of the exemption notifications covered chemical fertilisers or was confined only to soil fertiliser. There was no controversy between the parties as the molten urea was a chemical fertiliser or not............ It is therefore difficult to appreciate how the CEGAT could persuade itself to hold by making out entirely a new and a third case for the parties to the effect that molten urea was not a fertiliser at all, especially in the absence of such a pleading of any party. [para 11] 26. Tribunal in the case of Ingram Micro Indian Pvt Ltd 2023(383) ELT 204 (Tri.Del) held that 29. it is not possible to accept this contention for the simple reason that an executive IP Phone does not match the desc....