2007 (8) TMI 46 - AT - Service Tax

Refund (Service tax) - Revenue contended that appellant is not entitle for refund of service tax on the ground that they paid the service tax rightly on the behalf of its foreign consultant - Held that revenue contention was correct and refund not allowed

Summary

Issues:
Refund claims rejection for service tax paid by the appellants.

Analysis:
The appellants contended that as recipients of the service, they are not required to pay tax during the relevant period and thus are entitled to a refund for the service tax wrongly paid. They cited the decision in the case of Ispat Industries v. CCE to support their claim. However, the Revenue argued that the appellants had paid the tax on behalf of the foreign Consultant as per the agreement between them, and thus, the service tax was rightfully paid, making the appellants ineligible for a refund.

The Tribunal found that the appellants had filed refund claims for the service tax paid as recipients of consulting Engineering service, where they were obligated to pay all taxes on behalf of the foreign Consultant as per the agreement. This issue had already been settled by the Tribunal in previous decisions referenced by the Revenue, namely Jindal Steel and Vikram Cement cases.

The Tribunal dismissed the appellants' reliance on the Ispat Industries case, stating that the facts of that case were not similar to the present case. In the Ispat Industries case, the Tribunal had determined the taxability of the service provided by foreign firms based on the evidence presented, concluding that the service did not attract service tax due to the nature of the firms involved.

Ultimately, since the issue at hand had already been resolved by the Tribunal in the Jindal Steel and Vikram Cement cases, the impugned order rejecting the refund claims was upheld, and the appeals were dismissed.