TaxTMI 
TaxTMI 
2026 (8) TMI 1604
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....m was rejected by the Adjudicating Authority, vide Order-in-Original No.: 199/Refund//ND/ST-1/Kol/16-17 Dated 23.02.2017. On appeal, the Ld. Commissioner (Appeals) has upheld the rejection of the refund claim. Aggrieved against the impugned Order-in-Appeal, upholding the rejection of the refund claim, the Appellant has filed this appeal. 2. The facts of the case are that the appellant is engaged in providing mining services and have their registered office in Kolkata. During the Financial Year 2010-11, the Appellant had entered into agreement with M/s NTPC Limited for the development and operation of Pakri Barwadih Coal Project in Jharkhand, for mining 311.7 million tons of coal for an estimated period of 27 years. The total Development Stage Expenditure for Fixed Infrastructure Facilities was agreed for an amount of Rs 280 Crores which was inclusive of all taxes and duties. As per the terms of the said agreement, an advance of 20% of the total Development Stage Expenditure was to be given to the appellant by M/s. NTPC. Accordingly, Rs 56 Crores was received by the appellant from NTPC at the beginning of Development Stage. On the said receipt of advance amount of Rs.56 Crores, t....
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....ther, the refund application for the said period i.e., for the Financial Year 2012-13 and 2013-14, was not presented within the time limit envisaged under Section 11B of Central Excise Act 1944, made applicable to service tax vide section 83 of the Finance Act 1994. (iii) That the appellant had not provided any proof of non applicability of unjust enrichment. 2.5. Accordingly, a Show Cause Notice dated 17.09.2015 was issued to the appellant for rejecting the refund claimed by the appellant on the above grounds. The Lower authorities have rejected the refund claimed by the Appellant. Hence, this appeal. 3. The appellant's primary contention is that they were not liable to pay Service Tax during the impugned period as they have not rendered any taxable service. It has been submitted that they had entered into an agreement with M/s NTPC Limited for the development and operation of Pakri Barwadih Coal Project in Jharkhand and as per the terms of the said agreement, the appellant received an advance of Rs. 56 Crores from M/s. NTPC; that on the said receipt of advance, they have paid service tax. It is specifically informed that in May 2014, NTPC terminated the agreement e....
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....x on the Legal services received by them under RCM. It is contended by him that the appellant have not filed the refund claim within the time limit fixed under Section 11B of the Central Excise Act made applicable to Service Tax vide Section 83 of the Finance Act. Thus, the Ld. Authorized Representative of the Revenue supported the rejection of the refund vide the impugned order. 6. Heard both sides and perused the appeal records. 7. On going through the records, we observe that the following issues needs to be examined: (i) Whether the appellant has paid Service Tax in this case under mistake of fact or not. (ii) Whether the appellant is entitled to exemption from service tax, as provided under Sl. No. 6(b) of the Notification No. 25/2012 dated 20.06.2012 or not. (iii) Whether the refund application filed by the appellant is barred by the time limit prescribed under Section 11B of the Central Excise Act, 1944 made applicable to Service Tax vide Section 83 of the Finance Act, 1994 or not. (iv) Whether the provisions of unjust enrichment are attracted in this case or not. (i) Whether the appellant has paid Service Tax in this case u....
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....rvice is deemed to have been provided. By virtue of this deeming provision, the point of receipt of any advance is taken as the point at which the service is said to have been provided. Since the charging section does not differentiate between 'Service provided' and 'service agreed to be provided', in as much as service tax is leviable equally on both, it may safely be assumed that the Finance Act 1994 treats both these activities as the same as far as their taxability is concerned. Hence if turnover is taken to constitute 'services provided', then it would equally include 'services agreed to be provided. As the advance received is for services agreed to be provided, they would also constitute turnover of any assessee for purpose of Sl.No.6B of Notification No. 25/2012." 8.2. We do not agree with the above findings recorded by the Ld. Commissioner (Appeals) in the impugned order. There is no dispute that the liability towards payment of Service Tax arises immediately on receipt of the advance. It is an admitted fact that the advance was received for the services 'to be rendered'. Service Tax paid on the advance will be adjusted later when the service ....
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....x. Thus, it is the case of the appellant that they were not required to pay Service Tax by virtue of the above said Notification. However, the authorities below have considered the advance of Rs.50,86,01,703/- received by the appellant during the period October 2011 to March 2012, as 'Turnover' for the Financial Year 2011-12 as the said amount was reflected in their ST-3 returns, to hold that the said exemption is not available to the appellant. As we have already held that the advance amount cannot be considered as 'Turnover' of the appellant in view of the fact that no service has been rendered, the said amount has to be excluded from the value of 'Turnover' of the appellant for the corresponding Financial Years, for examining the eligibility of the appellant towards exemption in terms of the threshold limit of Rs.10 lakhs in the preceding financial year. Accordingly, we hold that the appellant is eligible for the exemption from payment of Service Tax on the said services under RCM basis, as per Notification No. 25/2012 dated 20.06.2012. 8.4. It is therefore observed that since the Taxable Value of the appellant for each of the Financial Years in question viz. 2011-12, 201....
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....ility of the exemption provided under Sl No. 6(b) of Notification No. 25/2012-ST dated 20.06.2012 cannot be denied to the appellant on the ground that the Appellant has availed CENVAT credit of the service tax paid on Legal services. In view of the above, we hold that since the appellant is eligible for the exemption as provided under Sl. No. 6(b) of the Notification, the appellant was not liable to pay Service Tax on RCM basis for the Legal services received by them from the advocates, during the period September 2012 to February 2015. The issues at Sl. Nos. (i) and (ii) are accordingly answered in favour of the appellant. (iii) Whether the refund application filed by the appellant is barred by the time limit prescribed under Section 11B of the Central Excise Act as made applicable to Service Tax vide Section 83 of the Finance Act. 9. In this regard, at the outset, we note that since the appellant is not liable to pay service tax, the said amount paid by the appellant is to be considered as 'deposit' and hence the Service Tax paid by the appellant is liable to be refunded. However, we find that the Lower authorities have also rejected the refund on the ground that t....