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2023 (2) TMI 1252 - CESTAT CHENNAIRejection of refund claim - time limitation - the date of last challan on which service tax was paid was on 08/07/2017 and the last return filed on 13/08/2017, whereas the Appellant filed refund claim only on 12/03/2019 for the refund of prepaid service tax - Double taxation or not - violation of principles of natural justice - HELD THAT:- The appellant is involved in civil construction and works contract service and the completion of a project is spread over a period of time. They have filed a Trans1 declaration for the service tax paid on advances after the introduction of GST on 01/07/2017. On being pointed out by the Department about having wrongly carried forward the prepaid service tax to TRAN-1, they reversed the same in the GST return filed in the month of January 2019. Consequent to reversal, they filed refund claim on 12.3.2019 for the refund of prepaid service tax. The cause of action took place only after the introduction of GST due to which they had to pay duty once again under the GST regime for part taxes paid under Service tax for their projects. The matter is hence not time barred. The factual question is whether tax has been discharged twice for the same activity. The transition from one tax regime to another has its own challenges for tax payers and an overtly legalistic view is not called for in this difficult period. The Appellant has made available documents that would facilitate the verification of double taxation as claimed. Since the department has asked the Appellant to reverse the prepaid service tax claimed as per GST TRAN – 1, and if the facts on verification are found in order then the amount has to be refunded in cash to the Appellant. The ends of justice would be met if Revenue verifies the facts of the activity being taxed twice and decides on the refund application accordingly. The refund matter is remanded back to the Original Authority for verification of facts and de novo adjudication on the only issue of taxation of the same activity twice which has led to the claim of refund. The lower authority shall follow the principles of natural justice and afford a reasonable and time bound opportunity to the appellant to state their case both orally and in writing if they so wish, before issuing a speaking order in the matter - Appeal disposed off by way of remand.
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