2019 (2) TMI 208 – MADHYA PRADESH HIGH COURT – TMI – Rejection of refund claim of service tax – construction of Government buildings – refund arising as a result of restoration of exemption benefit of N/N/. 12/2012 and 25/2012 dated 20/06/2016 – Prospective effect or retrospective effect – Rule 173-S of the Central Excise Rules, 1944.
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Whether an amount paid under the mistaken belief that the service is liable to service tax when the same is actually exempt, be considered as service tax paid? – Held that:- Evidently, the notification No. 12/2012 & 25/2012 ceased to exist w.e.f. 01/04/2015. The exemption was revived by notification dated 01/03/2016. But since it was prospective in effect, the appellant was not entitled for any exemption, which the appellant was aware of and with open mind and eyes deposited the service tax due with interest.
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Evidently, the works contract undertaken by the appellant during said period was not exempted. Therefore, the question that, the servic
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: Shri Praveen Surange, learned counsel ORDER This appeal under Section 35G(1) of the Central Excise Act, 1944 is directed against the final order No. A/51822/2018-SM(BR) dated 14/05/2018 passed by the Customs, Excise and Service Tax Appellate Tribunal, whereby, the Tribunal has upheld the rejection of application for refund claim of ₹ 25,49,317/-, by the Assistant Commissioner, Service Tax, Division Gwalior by his order dated 15/06/2017. The appellant holds service tax registration and paying service tax under the category of Works Contract Services . During the period 01/03/2015 to 30/09/2015 the appellant had paid ₹ 25,49,317/- towards Service Tax and interest of ₹ 57,716/- on the following work contracts:- (i) Construction of EWS houses for Special Area Development Authority (A Government Authority) vide work order No.02/SADA/ 2014-15, Agreement No. 04 dated 22.12.2014. (ii) Construction of LIG houses (Affordable Housing) for Indore Development Authority vide Fou
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4/2015, the appellant was availing exemption for civil works related to State and Union Government establishments used for administrative purpose. The exemption was availed under notification No. 12/2012 and 25/2012 dated 20/06/2016. As the notification dated 20/06/2012 was withdrawn w.e.f. 01/04/2015, the exemption from service tax on the nature of work the appellant engaged in was not available; therefore, he paid service tax with interest for the period 01/03/2015 to 30/09/2015. The exemption was later on restored vide notification No. 9/2016-ST dated 01/03/2016 vide Entry Sr. No. 12A(a) for the services provided under a contract which has been entered into prior to 01/03/2015 and whereon appropriate stamp duty, where applicable, has been paid prior to that date. The exemption was restored till 31/03/2020. However, as the effect of exemption vide executive order was prospective; the legislature, vide Finance Bill 2016 restored the exemption from retrospective effect by incorporating
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or other persons specified in Explanation 1 to clause (44) of section 65B of the said Act, under a contract entered into before the 1st day of March, 2015 and on which appropriate stamp duty, where applicable, had been paid before that date. (2) Refund shall be made of all such service tax which has been collected but which would not have been so collected had sub-section (1) been in force at all material times. (3) Notwithstanding anything contained in this Chapter, an application for the claim of refund of service tax shall be made within a period of six months from the date on which the Finance Bill, 2016 receives the assent of the President. The appellant invoking Rule 173-S of the Central Excise Rules, 1944 applied for refund of ₹ 25,49,317/- vide Form-R on 22/03/2017, received by the Department on 24/03/2017. The Authority concern (Assistant Commissioner) on receiving the application issued show cause notice on 01/05/2017 calling upon the appellant as to why the applicatio
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an 'Service Provider', the word 'buyer' shall mean 'Service receiver'. (Except Under Section 12 B) and 'goods', shall mean 'Service' whenever they appear Under the Section of Central Excise Act, 1944 and circular/ Clarification, issued in this regard, which will be quoted referred or discussed in this Show Cause Notice. Further, the word 'Act' appearing in Section 12B of the Central Excise Act, 1944 shall mean 'Finance Act, 1944', and the word 'buyer' shall mean 'ultimate buyer of goods which are manufactured using taxable services'. 2(b) Sub Section (I) Section 11B of the Central Excise Act, 1944 provides that any person claiming refund of any duty of excise may make an application for refund of such duty to the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise before the expiry of one year from the relevant date in such form and manner as may be prescribed and the application shall
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r person then the amount shall be paid to such buyer. Explanation annexed to Section 11B defined the 'relevant date' for the purpose of reckoning time period within which refund claim is to be filed. This date is the date of purchase of 'goods' in the case of claimed is other than the 'manufacture'. 3. And whereas the refund claim was received on 24.03.2017 therefore the service tax and interest deposited during the period of 01/03/2015 to 30/09/2015 through challans has been found time barred from the statutory time-limit defined under section 11B of the Central Excise Act, 1944 wherein it is clearly mentioned that refund claim should be submitted within a period of one year of the relevant date. 4. In view of the grounds mentioned above, the claim for refund of Service Tax filed by the Noticee on 24.03.2017 for ₹ 25,49,317/- does not appear to be admissible to them since refund claim of time barred Under Section 11-B of the Central Excise Act, 1944. 5. N
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nd has to be granted. The noticee has complied all the terms and conditions as stipulated in the Notification. Noticee has paid the service tax on the aforesaid tender/ work order and because of withdrawn of exemption by the government w.e.f. 01.03.2015 there was delay in payment of service tax and the noticee has paid the interest of ₹ 57716/- and has applied for refund of the said amount of service tax with interest. And that the notification for restoration of exemption was issued in the month of March 2016 i.e. on 01.03.2016 and the noticee has filed the refund claim on 24.03.2017 within a period of one year from the month in which the exemption notification has been restored. It was further stated in reply that there was ambiguity in the exemption and the refund, the noticee was not aware hence noticee most humbly and respectfully requested that kindly condone the delay in filing of the refund claim if any and sanction at the earliest in the interest of justice. Since, the n
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. It was urged that even if it is then the period of limitation prescribed being one year and since notification for restoration of exemption was issued on 01/03/2016 and the appellant had filed the refund claim on 24/03/2017, the same should have been allowed. The appeal was, however, dismissed on 28/09/2017 by Commissioner (Appeals), on the findings:- 7. To put the legal position in proper prospective, I may mention that initially the mega exemption notification No. 25/2012-ST granted exemption interalia to certain activities under taken for the government. The said notification was amended vide notification No.06/2015- ST dated 01.03.2015 where by the said exemption for the Govt work was withdrawn. Later, vide notification No. 9/2016-ST dated 01.03.2016 the said exemption was restored. The notification No. 9/2016-ST is prospective in nature and it does not grant retrospective exemption to the activities undertaken prior to 01.03.2016 as wrongly contended by the appellant. The retros
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ent; or (iii) an art or cultural establishment; (c) a residential complex predominantly meant for self-use or for the use of their employees or other persons specified in Explanation 1 to clause (44) of section 65B of the said Act, under a contract entered into before the 1st day of March, 2015 and on which appropriate stamp duty, where applicable, had been paid before that date. (2) Refund shall be made of all such service tax which has been collected but which would not have been so collected had sub-section (1) been in force at all material times. (3) Notwithstanding anything contained in this Chapter, an application for the claim of refund of service tax shall be made within a period of six months from the date on which the Finance Bill, 2016 receives the assent of the President. 8. It can be seen that section 102 was a self-contained provision for refund of any tax paid during the impugned period. The said section also provided the time limit of 06 months for filing the refund cla
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of the Finance Bill 2016 prescribed specific period of limitation of six months from the date of the assent of the President (which being 14.05.2016) for refund. And that the appellant applied for refund on 24/03/2017, i.e., with a delay of 131 days, dismissed the appeal observing:- 8. Having carefully heard the submissions of both the sides, I find that there is no dispute on the facts. The retrospective exemption having been granted by the legislative, there was a clause for refund of the tax paid during the intervening period subject to the condition that such refund claim are filed within the period of six months. Admittedly, the refund stands filed beyond the said period, thus, contravening the condition. There is no power with the Central Excise Authorities to legislate or to travel beyond the statutory limitations provided by the legislature. Similarly, neither the Tribunal has such powers to go beyond the provisions of the Act. The issue is well settled. Reference can be made t
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m was beyond the control of the appellant inasmuch as the construction service covered in the refund claim is actually exempt of service tax was itself disputed by the authorities as the same was under investigation? (C) Whether service tax paid mistakenly under construction service although actually exempt, is payment made without authority of law? As regard to substantial questions of law as proposed at 'A', we are not commended to any cogent material that the amount of ₹ 25,49,317/- towards service tax and the penalty thereof ₹ 57,716/- for the period 01/03/2015 to 30/09/2015 was deposited under misconception. Evidently, the works contract undertaken by the appellant during said period was not exempted. Therefore, the question that, the service tax and interest was paid under misconception does not arise, as would give rise for the proposed substantial question. As regard to substantial question of law at 'B', the said question in given facts of present a
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question at 'B' also does not arise for consideration. As regard to substantial question 'C', the contention that the service tax was paid mistakenly is also not borne out from the facts. The decisions relied upon by the appellant in Commr. Of C.Ex. (Appeals), Bangalore Vs. KVR Construction [Writ Appeal No. 2992-2993 of 2009 (Karnataka High Court)], CC&ST Vs. H.K. Dave Ltd. [(2015) 38 STR 77], Wazir Singh Swaran Singh Consignment Stockist (P) Ltd. Vs. CCE [2010 (18) STR 468], CCE Vs. Crompton Greaves Ltd. [(2011) 22 STR 380], CCE Vs. Suresh C. Nayi [(2011) 24 STR 123], Jubilant Enterprises P. Ltd. Vs. CCE [(2014) 35 STR 430], Porcelain Electrical Mfg. Co. Vs. CCE, New Delhi [1998 (98) ELT 583 (SC)], Collector, Land Acquisition & Anr. Vs. Mst. Katiji & others [(1987) 62 CTR (SC)(Syn)23], Bharat Auto Center Vs. CIT [2006 (282) ITR 366 All.], CCE Vs. KVR Construction [(2012) 26 STR 195 (Kar.)] are of no assistance in present fact situation as these judgments tu
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