TaxTMI 
TaxTMI 
2026 (9) TMI 892
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.... Service Tax Appellate Tribunal, Chennai (hereinafter referred to as "the CESTAT" for the sake of convenience). 2. The brief facts which are necessary for the disposal of the present Civil Miscellaneous Appeal are that the appellant is registered with the Service Tax Department for providing "Membership of Club or Association Service". While so, a demand was raised against the appellant for a sum of Rs. 29,24,687/- towards the subscription amount received by the appellant from its members. The said demand was challenged before the First Appellate Authority, namely, the Commissioner (Appeals), and the First Appellate Authority, vide order dated 15.12.2009, set aside the said demand. The said order was subsequently upheld by the CESTAT. In....
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....(vii) Whether the appellant is entitled for the interest form the date of deposit or to what extent? " 4. Heard the learned counsel appearing for both sides on the above questions of law and perused the materials available on record. 5. The learned counsel appearing for the appellant would submit that the CESTAT has erroneously dismissed the claim of the appellant on the premise that the appellant had passed on the tax amount to its members. He would submit that, according to the Auditor's Certificate, in the books of account, the said amount is shown as the amount refundable to the members, but such material aspect was not considered by the authority. It is also the contention of the learned counsel for the appellant that the Auditor....
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....m the Department. 7. We have given our anxious consideration to the submissions made on either side. 8. It is well-settled principle of law that, any refund to be made under Section 11B of the Central Excise Act, 1944 would be subject to the doctrine of unjust enrichment. The Hon'ble Supreme Court has, time and again, categorically held that, when the tax component has already been recovered from their customers or passed on to other persons, then the taxpayer, is not entitled to seek restitution from the State. The right to restitution is neither automatic nor unconditional. In an oft-quoted judgment of the Hon'ble Supreme Court in Mafatlal Industries Ltd. v. Union of India, reported in (1997) 5 SCC 536, it has been held as follows:-....
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....ends. In other words, he cannot collect the duty from his purchaser at one end and also collect the same duty from the State on the ground that it has been collected from him contrary to law. The power of the court is not meant to be exercised for unjustly enriching a person. The doctrine of unjust enrichment is, however, inapplicable to the State. State represents the people of the country. No one can speak of the people being unjustly enriched." 9. As per the above judgment, for a taxpayer to claim refund, he must establish the actual loss or prejudice suffered by him. In the case in hand, even according to the Auditor's Certificate, the appellant has recovered a sum of Rs. 9,09,717/- from its members and only a sum of Rs. 6,41,369/- r....