Customs, Excise and Services Tax Appellate Tribunal (CESTAT): Ashok Jindal (Judicial Member) allowed an appeal which was filed against the rejection of a refund claim.
Initially, the proceedings were initiated against the appellant for non-payment of service tax under reverse charge mechanism for a commission paid to the foreign-based commission agent and during the course of audit, the objection was raised, the appellant paid the entire amount of service tax along with interest and prayed that the proceedings against the appellant was to be closed but the department issued a show-cause notice by invoking the extended period of limitation. The demands of service tax along with interest paid by the appellant were appropriated and the penalties were also imposed.
The appellant filed an appeal against the said order and prayed that in this case, the extended period of limitation was not invokable as whatever service tax was to be paid by them; they were entitled to take credit of the same. Therefore, it was a case of revenue neutrality. The Tribunal had concluded with the same and that appeal was allowed. In consequence, to the order the appellant had filed a refund claim of service tax paid for the extended period of limitation and interest. The adjudicating authority had rejected the same and on appeal before the Commissioner (Appeals), it was concluded that the appellant had already paid service tax along with interest in terms of Section 73 (3) of the Finance Act, 1994, the proceedings stood concluded, therefore, the refund of the amount claimed by the appellant was not admissible. Thus, the instant appeal was filed.
The Tribunal observed that both the parties had admitted the fact that in the earlier round of litigation, this Tribunal had passed the order and dropping the demand of service tax for an extended period of limitation along with interest and in that circumstance the refund claim filed consequent that order was admissible in the eyes of law. The Tribunal allowed the appeal while setting aside the impugned order.[Spray Engineering Devices Ltd. v. CCE & ST, 2021 SCC OnLine CESTAT 10, decided on 11-01-2021]
Suchita Shukla, Editorial Assistant has put this story together
