Service Tax Refund filed after Introduction of GST cannot be denied by invoking S. 11B: CESTAT
The Chennai bench of Customs, Excise & Service Tax Appellate Tribunal has held that service tax refund filed after the introduction of GST cannot be denied by invoking section 11B.
During the audit of accounts of the assessee, M/s. Doowon Automotive Systems India Pvt. Ltd. the AO noticed that the assessee is liable to pay service tax under the category of renting immovable property service, ocean freight charges, and scientific and technical services. The appellant paid the tax along with the applicable cess. As they were eligible to avail credit on the amount paid under the reverse charge mechanism, they filed a refund claim forRs.7,64,980/- under sec. 11B of the Central Excise Act, 1944 read with section 142(3) of CGST Act, 2017.
The original authority rejected the refund claim holding that there is no provision to grant a refund after the introduction of GST. Against the order, the assessee preferred to appeal before Commissioner (Appeals) who held that the appellant is eligible for a refund and remand the matter to the adjudicating authority to verify whether the refund is time-barred or not. The adjudicating authority rejected the refund claim on the ground of limitation under sec.11B(1), and the assessee filed an appeal before the Commissioner (Appeals). The order of rejection was upheld by the Commissioner (Appeals). Henceassessee preferred appeal before CESTAT.
Mr. T.R. Srinivasan, counsel appeared on behalf of the appellant and submitted that the appellant has paid the service tax on renting immovable property services, ocean freight charges, and scientific and technical services. If the GST was not introduced, they would be eligible to avail of CENVAT credit of the same. As per section 142 of the CGST Act, 2017, the appellant is eligible for a cash refund. Counsel submitted that the refund claim in the appeal is limited to Rs.3,66,307/- and does not include the cess paid by them.
The Tribunal observed that no limitation is applicable as provided under Section 11Bdue to the overriding effect of the CGST Act and the appellant is entitled to a refund under the provisions of Section 142(3) r/w 142(8) (b) of the CGST Act r/w the erstwhile provisions of Central Excise Act and the Cenvat Credit Rules.
The Coram of Ms. SulekhaBeevi C.S., Member (Judicial)by relying upon the decision of Tribunal in the case of Jai Mateshwaari Steels Pvt. Ltd has held that “I am of the view that the rejection of refund claim on the ground of limitation is not justified. The impugned order is set aside. The appeal is allowed with consequential reliefs if any”.
Mr. R. Rajaraman appeared on behalf of the respondent.
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