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2020 (1) TMI 525 - AT - Service TaxRefund of service tax - transportation of petroleum products - benefit of N/N. 25/2012 -ST dated 20.06.2012 - principles of unjust enrichment - HELD THAT - The fact that the recipient of the service is also entitled to file a claim for refund is no longer res-integra. The issue stands decided by the Constitution Bench s decision in MAFATLAL INDUSTRIES LTD. VERSUS UNION OF INDIA 1996 (12) TMI 50 - SUPREME COURT where it was held that Where the burden of the duty has been passed on, the claimant cannot say that he has suffered any real loss or prejudice. The real loss or prejudice is suffered in such a case by the person who has ultimately borne the burden and it is only that person who can legitimately claim its refund. The appellant s eligibility for refund of service tax is prima facie sustainable on legal grounds - Ministry of Railway Circular No. TCR/1078/2011/2 dated 26.09.2012 also states that the refund claim is to be obtained from the concerned tax authority on the basis of monthly consolidated (STTG) certificate issued by Railways. The appellant s refund claim is also not hit by the doctrine of unjust enrichment as per CA certificate produced before the bench. Appeal allowed - decided in favor of appellant.
Issues:
1. Eligibility for refund of Service Tax on transportation of petroleum products by railways. 2. Interpretation of Notification No. 25/2012 -ST dated 20.06.2012. 3. Applicability of Section 68 of the Finance Act, 1994. 4. Validity of SSTG Certificate for availing Cenvat Credit. 5. Doctrine of unjust enrichment under Section 12B of the Act. Analysis: Issue 1: Eligibility for refund of Service Tax The appellant, engaged in manufacturing petroleum products, claimed refund of Service Tax paid to South Eastern Railways for transportation. The appellant argued that the service was exempt from Service Tax as per Notification No. 25/2012 -ST. The Constitution Bench's decision in Mafatlal Industries Ltd Vs Union of India established that the recipient of the service can claim a refund if the burden of duty has not been passed on to another person. The appellant provided evidence, including a Ministry of Railway Circular, supporting their refund claim. The Tribunal found the appellant eligible for the refund based on legal grounds and set aside the impugned order. Issue 2: Interpretation of Notification No. 25/2012 -ST The appellant relied on Notification No. 25/2012 -ST to claim exemption from Service Tax on transportation of petroleum products. The Tribunal acknowledged the exemption provided in the notification and considered it a valid basis for the appellant's refund claim. The circular issued by the Ministry of Railways further supported the appellant's position. Issue 3: Applicability of Section 68 of the Finance Act, 1994 The Revenue contended that the refund should be recovered from the IOCL, citing Section 68 of the Finance Act, 1994, which holds the service provider liable to pay Service Tax. However, the appellant argued that the burden of duty had not been passed on to another person, as established by relevant case laws and circulars. The Tribunal agreed with the appellant's position and allowed the appeals, providing consequential benefits. Issue 4: Validity of SSTG Certificate The appellant presented the SSTG Certificate issued by South Eastern Railways as evidence for availing Cenvat Credit. The Tribunal recognized the validity of the certificate under the Cenvat Credit Rules, 2004, and considered it a legitimate document for claiming the refund of Service Tax. Issue 5: Doctrine of unjust enrichment The appellant submitted a certificate from a Chartered Accountant verifying the absence of unjust enrichment under Section 12B of the Act. The Tribunal found the appellant's refund claim not hit by the doctrine of unjust enrichment, as supported by the CA certificate and other evidence presented. In conclusion, the Tribunal allowed the appeals, setting aside the impugned order and granting the appellant the refund of Service Tax on transportation of petroleum products by railways, emphasizing the legal validity of the appellant's claim and the absence of unjust enrichment.
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