TaxTMI 
TaxTMI 
2026 (7) TMI 1450
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....ervice invoices were not reported in the original ST-3 returns. Accordingly, the Appellant filed a revised ST-3 return on 29.09.2017 and reported a closing balance of Rs. 3,58,51,283/-. Consequent thereto, the appellant filed a refund claim of Rs. 2,13,30,499/- under Section 142(9)(b) the CGST Act on 28.02.2018. The said refund application was rejected vide an ex-parte order dated 23.06.2020 alleging the inadmissibility of credit on some services as well as on the ground of various discrepancies found in the invoices. Aggrieved by the same, the appellant filed an appeal before the Appellate Authority, who vide Order-in-Appeal dated 31.03.2021 remanded the matter back to the adjudicating authority to decide refund application afresh after providing an opportunity of hearing to the appellant, subsequently, a show cause notice was issued proposing to deny refund of Rs. 2,13,30,499/- on the ground that Appellant had belatedly filed revised Form ST-3 return by one day, which resulted in contravention to Section 142(9)(b) of the CGST Act. The said show cause notice was confirmed by the Order-in-Original dated 09.11.2021which was upheld by the impugned order. Aggrieved, the present appeal....
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....t be interpreted in a manner that gives effect to the overall scheme of return filing under the Service Tax Rules. Although Rule 7C specifically referred to Returns under Rule 7, the same cannot be read in isolation so as to exclude revised returns furnished under Rule 7B. Learned counsel also stated that a revised return, once filed in accordance with Rule 7B, substitutes and relates back to the original return and, therefore, assumes the same legal character as a return filed under Rule 7 in substance. Further, learned counsel contended that the statute did not contemplate two independent categories of returns and recognizes only one return, which could be corrected within the prescribed time limit. Accordingly, she submitted that the expression "return under Rule 7" in Rule 7C must be construed broadly to include such revised returns. A delay of one day in revising the return could be regularized by imposition of late fee of Rs. 500. Once such late fee is imposed, the delay would be regularized. She placed reliance on the judgment of the Meghalaya High Court in Commissioner of Goods and Services Tax versus M/s Amrit Cement Limited [2022 (62) G.S.T.L. 257 (Meghalaya)] wherein the....
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....9.2017. The appellant had filed the revised ST-3 within the time specified under the existing law. She relied on the Circular No. 207/5/2017-ST dated 28.09.2017 ('Circular') issued by CBIC, wherein it was clarified that all ST-3 returns filed for the impugned period on or before 31.08.2017 shall be deemed to be filed on 31.08.2017 and accordingly, the assesses will have more time to file revised ST-3 returns. All the conditions specified under Section 142(9)(b) of the CGST Act has been satisfied and accordingly the Appellant is entitled for the cash refund. 2.2 Learned counsel further submitted that the appellant is entitled to receive the interest on delayed refund of the cenvat credit availed on input services in terms of Section 11BB of the Act. In this regard, she relied upon the following decisions:- * Ranbaxy Laboratories Ltd. Versus Union of India and Ors [[2011] 33 STT 326 (SC)] * M/s. Fabrimax Engineering Pvt. Ltd. Versus Commissioner of Central Excise, Nagpur [2022 (379) E.L.T. 604 (Bom.)] * M/s Microsoft Corporation (India) Pvt. Ltd. (Microsoft) Versus The Commissioner of Service Tax, Delhi, The Commissioner of Central Excise and Ser....
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....f appellant was liable to be summarily dismissed on law point itself as the Revised Return had not been filed as per time limit (within 45 days) provided in Section 142(9) (b) of the CGST Act, 2017 read with Rule 7B of the Cenvat Credit Rules, 2004. As per Section 142(9)(b), the admissibility of Cenvat Credit was to be verified before processing of refund claim for which conditions provided under the Rule 9 & Rule 2(1) of the Cenvat Credit Rules, 2004, are to be fulfilled which the appellant had failed to substantiate, and had not submitted the relevant documents despite several opportunities given by the Adjudicating Authority or the refund Sanctioning Authority. While submitting documents before the Adjudicating Authority post remand, the appellant had only re-iterated what was already informed to the Adjudicating Authority in the proceedings which led to rejection of the refund claim vide order dated 23.06.2020 on account of non-fulfilment of conditions as prescribed under the Rule 9 of the CCR.2004, read with Rule 2(1) of the Cenvat Credit Rules, 2004.As regards the admissibility of enhanced Cenvat credit under the Revised Returns filed on 29.09.2017, the incremental credit was....
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....y days of such price revision and for the purposes of this Act such credit note shall be deemed to have been issued in respect of an outward supply made under this Act: Provided that the registered person shall be allowed to reduce his tax liability on account of issue of the credit note only if the recipient of the credit note has reduced his input tax credit corresponding to such reduction of tax liability. (3) Every claim for refund filed by any person before, on or after the appointed day, for refund of any amount of CENVAT credit, duty, tax, interest or any other amount paid under the existing law, 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 contained under the provisions of existing law other than the provisions of sub-section (2) of section 11B of the Central Excise Act, 1944 (1 of 1944): Provided that where any claim for refund of CENVAT credit is fully or partially rejected, the amount so rejected shall lapse: Provided further that no refund shall be allowed of any amount of CENVAT credit where the balance ....
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....as an arrear of tax under this Act and the amount so recovered shall not be admissible as input tax credit under this Act. (7) (a) every proceeding of appeal, review or reference relating to any output duty or tax liability initiated whether before, on or after the appointed day under the existing law, shall be disposed of in accordance with the provisions of the existing law, and if any amount becomes recoverable as a result of such appeal, review or reference, the same shall, unless recovered under the existing law, be recovered as an arrear of duty or tax under this Act and the amount so recovered shall not be admissible as input tax credit under this Act. (b) every proceeding of appeal, review or reference relating to any output duty or tax liability initiated whether before, on or after the appointed day under the existing law, shall be disposed of in accordance with the provisions of the existing law, and any amount found to be admissible to the claimant shall be refunded to him in cash, notwithstanding anything to the contrary contained under the provisions of existing law other than the provisions of sub-section (2) of section 11B of the Central Excise Act....
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....e liable to tax under the provisions of this Act. (11) (a) notwithstanding anything contained in section 12, no tax shall be payable on goods under this Act to the extent the tax was leviable on the said goods under the Value Added Tax Act of the State; (b) notwithstanding anything contained in section 13, no tax shall be payable on services under this Act to the extent the tax was leviable on the said services under Chapter V of the Finance Act, 1994 (32 of 1994); (c) where tax was paid on any supply both under the Value Added Tax Act and under Chapter V of the Finance Act, 1994 (32 of 1994), tax shall be leviable under this Act and the taxable person shall be entitled to take credit of value added tax or service tax paid under the existing law to the extent of supplies made after the appointed day and such credit shall be calculated in such manner as may be prescribed. (12) Where any goods sent on approval basis, not earlier than six months before the appointed day, are rejected or not approved by the buyer and returned to the seller on or after the appointed day, no tax shall be payable thereon if such goods are returned within six months from....
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....ng law, except typically the unjust enrichment bar (analogous to section 11B(2) of the Central Excise Act 4.4 Thus, the core issue that arises is the refund of credit that could not be transitioned. In the instant case, the fact position is that the appellant has Cenvat credit in balance which he could not transition in the GST TRAN 1/TRAN 2. The appellant then modified the ST 3 returns and filed the refund claim. The legal question that arises is whether section 142(3) create an independent right to cash refund of such credit, even if the "existing law" did not provide for cash refund of unutilized credit, and even if the credit was not carried forward. We note that the key interpretative points under section 142(3) that arise are "Credit of duty, tax or interest" under existing law which covers viz., CENVAT credit of central excise duty and service tax, and in some cases credit of additional customs duty. Such credit should be accumulated in the return for the last period under the existing law (e.g., June 2017 return for service tax/excise); and not carried forward either in the last return under existing law or in TRAN-1/TRAN-2. The core issue is whether such refund is "in a....
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....rovider of taxable service for providing an output service; or (ii) used by a manufacturer, whether directly or indirectly, in or in relation to the manufacture of final products and clearance of final products upto place of removal and includes services used in relation to modernization, renovation or repairs of a factory, ................................ and excludes, inter alia, services such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetics and plastic surgery, membership of club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees on vacation such as leave or home travel concession, when such services are used primarily for personal use or consumption of any employee. In the instant case, we find that in cases of services which are excluded from the category of input services like rent-a-cab, outdoor catering services etc., the Appellant failed to provide satisfactory clarification despite grant of multiple opportunities to substantiate whether such services were used in furtherance of business/output service or otherwise. We note that while Cenvat credit is a substantiv....
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....e exclusion of general statutes like the limitation act from the purview of special statute serves to maintain the integrity and coherence of the legislative scheme, preventing potential conflicts, and inconsistencies in statutory interpretation." [emphasis supplied] Hence, the time limit specified under Rule 7 (B) is sacrosanct. 5.2 Consequently, we hold that the delay of one day in the filing of the revised return cannot be condoned as procedural delay. 6. On applicability of Rule 7C for payment of late fee, the Ld Counsel submissions are not legally tenable as Rule 7C itself clearly restricts the scope of returns related to Rule 7, and does not cover Revised Returns stipulated in Rule 7B.We note that the provisions related to Rule 7C of the Service Tax Rules, 1994, came into existence vide Notification No.19/2016 dated 01.03.2016 with effective date as 01.04.2016, and at that point in time the provisions related to Rule 7B also existed with Rule 7. However, the absence of the reference to Rule 7B in the said Notification clearly confirms that the intent of said provision was to make it applicable with respect to Rule 7 only and not Rule 7B. 7. As regards the conte....
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....ly filed refund application in order to encash the balance of Cenvat credit. Thus, there was no dispute regarding eligibility to file refund claim under Section 142 (9)(b) whereas in the instant case the eligibility to claim refund in terms of Section 142(9)(b) itself was in dispute as the Revised Return was not filed as per time limit prescribed in the existing law. Therefore, the said case law is not applicable in the instant case. (b). M/s Bharat Heavy Electricals Ltd. v. Commissioner of C.T., Secunderabad-ST [2020 (41) G.S.T.L. 465 (Tri.-Hyd.)]:- This case pertains to refund of unutilised Cenvat credit balance in Credit ledger arising out of original ST-3 Returns (Rule 7) for period ending June, 2017whereas in the instant case the refund claim has been made by Appellant on the basis of Revised Returns (under Rule 7B) which was not filed within the specified time limit prescribed in Section 142(9)(b) of the CGST Act, 2017. Thus, the facts & circumstances are not same in cited case. In fact, the Hon'ble Tribunal has rejected the Appeal filed by M/s Bharat Heavy Electricals Limited and observed that cash refund of unutilized credit not permissible. Therefore, the said cas....
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....17.Also, in the case in hand, the admissibility of Cenvat credit itself is in question which have remained unsubstantiated for long by the Appellant despite opportunities granted to them. (g). M/s. Diaspark Infotech Pvt. Ltd. Versus CGST, CE & CC, Indore, 2019 (2) TMI 948 - CESTAT New Delhi. This case pertains to refund of undisputed & unutilised Cenvat credit even if balance in ST-3 Return is shown as "NIL" whereas in the case in hand the refund claim has been made by Appellant on the basis of Revised Returns (under Rule 7B) which too was not filed within specified time limit prescribed in Section 142(9)(b) of the CGST Act, 2017.Also, in the case in hand, the admissibility of Cenvat credit itself is in question which have remained unsubstantiated for long by the Appellant despite opportunities granted to them. Therefore, the reliance placed by the Appellant is not tenable. (h). M/s Punjab National Bank Versus Commissioner of C.T., Bangalore North, 2021 (52) G.S.T.L. 421 (Tri.-Bang.). The Tribunal observed that Commissioner (Appeals) was not justified in invoking a new ground to reject refund claim whereas in the case in hand the Commissioner (Appeals) did not rai....