TaxTMI 
TaxTMI 
2026 (4) TMI 522
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....he facts in brief are as follows: 1.1 Appellant was audited for the period from 01.04.2016 to 30.06.2017 on 23.12.2021 and 16.02.2022. During the audit it was observed that service tax for the period 2016-17 and 2017-18 (up to June, 2018) is short paid/not paid by the appellant as below: S. No. Service Service tax not paid/short paid Date of payment Mode 1. Legal Consultancy or Import of Service Rs.83,040/- 02.03.2022 Reverse Charge Mechanism 2. Service Tax on Ocean Freight Rs.6,79,550/- 02.03.2022 Forward Charge Mechanism 1.2 On being pointed out, the appellant deposited the aforesaid amount along with amount of applicable interest and the proportionate penalties. After depositing, appella....
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.... otherwise has already been decided by different benches of this Tribunal and the department has accepted those decisions, since the issue is no more res integra, the order confirming rejection of refund claim is not sustainable. It is also submitted that service tax initially was not paid due to bona fide belief of it to be paid by the service provider. However, the same was paid immediately after it was pointed out but by that time the Goods and Service Tax Act, 2017 (GST Act) was already introduced. Not only this, the time period for filing Tran-1 had also expired. The appellant was left with no opportunity but to invoke Section 142(3) of the GST Act. The submission has not been considered by the adjudicating authorities below. To suppor....
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....remained unearthed. Hence, the refund claim has rightly been rejected invoking the grounds of apparent suppression. It is further submitted that section 142(8)(a) of the CGST Act, 2017 clearly provides that where any amount of tax becomes recoverable pursuant to assessment or adjudication proceedings, whether initiated before or after the appointed day, such amount shall be recovered as arrears and shall not be admissible as input tax credit. Audit proceedings form an integral part of the recovery mechanism under the Service Tax law and cannot be excluded from the scope of Section 142(8. 4.1 It is also submitted that Section 142(3) cannot be read in isolation. A harmonious reading of Section 142 makes it clear that refund under sub-secti....
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....artially rejected, the amount so rejected shall lapse: Provided further that no refund shall be allowed of any amount of CENVAT credit where the balance of the said amount as on the appointed day has been carried forward under this Act." It becomes clear that refund claims for amount of Cenvat credit accrued under existing law are sustainable even after coming into effect of GST, Act. The provision further provides that the amount of said refund shall be paid in cash without invoking Section 11B(2) of Central Excise Act, 1944. 7. In the present case, the refund claim admittedly is of the Cenvat credit of the service tax paid by the appellant under Reverse Charge Mechanism. Apparently, the service tax in question pertains to t....
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.... of fraud. On the contrary, the bona fide belief of the appellant, the service recipient and the fact that payment/discharge of liability along with the interest and penalty was made immediately after it was pointed out in audit reflects the due compliance of the erstwhile provisions on part of the appellant. 8. We further observe that Rule 9(1)(bb) of Cenvat Credit Rules, 2004, as has been invoked by the adjudicating authorities below does not apply to service recipients. The provision is held to have wrongly been invoked. The issue has earlier been decided as is apparent from three of the decisions relied upon by the appellant. Subsequent thereto also, this Tribunal in the case of M/s. Indo Tooling Pvt. Ltd. Vs. Commissioner of Central....
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....d day, under the existing law, any amount of tax, interest, fine or penalty becomes recoverable from the person, the same shall, unless recovered under the existing law, be recovered as an arrear of tax under the CGST Act and the amount so recovered shall not be admissible as input tax credit under this Act. Further, sub-section (5) of Section 142 of the CGST Act provides that every claim filed by a person after the appointed day for refund of tax paid under the existing law in respect of services not provided shall be disposed of in accordance with the provisions of existing law and any amount eventually accruing to him shall be paid in cash, notwithstanding anything to the contrary under the provisions of existing law other than the provi....