TMI Blog2012 (7) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... der of the learned Single Judge passed in No. K.V.R Constructions v. CCE [2010] 25 STT 436 (Kar.). Parties are referred to in this appeal as per their rank in Writ Petition. 2. The petitioner, M/s. KVR Construction is a construction company rendering services under category of "Construction of Residential Complex Service" and are paying the Service Tax in accordance with Finance Act, 1994. They have undertaken the construction of following works on behalf of Shri Adichunchanagiri Shikshana Seva Trust by virtue of an agreement dated 7-12-2004 : ( a ) Medical college ( b ) AIMS Hospital ( c ) SJBIT Engineering college ( d ) SJBIT Engineering Boys Hostel 3. It is also not in dispute that Service tax came to be paid in accordance with the Finance Act, 1994 for the services rendered for the above trust by constructing above buildings for the periods May 2005 to February 2006 and May 2006 to February 2007. During the month of March 2008, petitioner filed two refund applications dated 19-3-2008 which were received by the Department on 28-3-2008 contending that building construction which was done by them was to a non-profit organization and they were not liable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid as service tax by virtue of Section 83 of Finance Act, 1994, the application of Central Excise Act comes into play. Therefore, any amount that has to be refunded has to be in accordance with Section 11B of Central Excise Act, irrespective of the nature of the tax paid, and the refund has to be only under Section 11B of the Act. Hence, he contends that unless, the refund claim is made within the time prescribed under Section 11B of the Act, the respondent could not have had the benefit of refund of the amount and as a matter of fact Form-R prescribed for refund of amounts under Section 11B of the Act was filed by the respondent in the instant case and as such he contends that learned Single Judge erred in holding Section 11B as inapplicable. Therefore, he prays for the order of the learned Single Judge to be set aside by upholding the order of the Appellate authority. 8. He also contends that by virtue of Section 35B(1)(b) of the Act, there is statutory appeal to the Appellate Tribunal. Therefore, the Writ Petition itself was not maintainable and for this proposition, he relies upon the judgment of Hon'ble Supreme Court in the case of United Bank of India v. Satyawati Ton ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it organization. The department is also not denying that services rendered by the respondent by putting up constructions of several buildings stated above to the trust, which is a non-profit organization, hence, a non-profit service is not taxable. 13. According to the petitioner, above said amounts were paid under a mistaken impression that they were liable to pay such service tax and the amount of refund claimed by them was not charged by them and collected from the person to whom they rendered service. In other words, according to them, they have paid above said amounts under a mistaken notion that they were liable to pay even though they are not liable to pay by virtue of circular dated 17-9-2004 and accordingly sought for refund of the said amount. 14. While adjudicating the refund claim of petitioner, the adjudicating authority accepted the contention of petitioner and held the services rendered by petitioner were not exigible to service tax. As a matter of fact, the order of the Assistant Commissioner of Central Excise dated 19-11-2008 reads as follows : "Thus it is evident that if the building or the civil structure are for the use of organizations or institutions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 11B of the Central Excise Act, 1944 or under Section 27 of the Customs Act, 1962 and subject to claimant establishing that burden of duty has not been passed on to a third party. In such circumstances, it was held, no civil suit for refund of duty is maintainable. It also observes that writ jurisdiction of High Courts under Article 226 and of Supreme Court under Article 32 remains unaffected by the provisions of Section 11B of the Act. It was further held that concerned Court while exercising the jurisdiction under the said articles, will have due regard to the legislative intent manifested by the provisions of the Act and the writ petition would naturally be considered and disposed of in the light of the provisions of Section 11B of the Act. It has been held therein that power under Article 226 has to be exercised to effectuate the regime of law and not for abrogating it, as the power under Article 226 is conceived to serve the ends of law and not to transgress them. At paragraph 113 of the said judgment, they classify the various refund claims into three groups or categories : ( a ) The levy is unconstitutional-outside the provisions of the (I) Act or not contemplated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the category (I) provisions of the Act or not contemplated by the Act - In such cases, the jurisdiction of the civil courts is not barred. The aggrieved party can invoke Section 72 of the Contract Act, file a suit or a petition under Article 226 of the Constitution and pray for appropriate relief inclusive of refund within the period of limitation provided by the appropriate law. - Dulabhai's case ( supra ) - para 32 - clauses (3) and (4)." 16. Yet another ground raised by Revenue is regarding maintainability of Writ Petition on the ground that alternate remedy of appeal under Section 35B(1)(b) of C.E. Act, is available and without availing the same, writ jurisdiction cannot be invoked and relies upon the decision of Satyawati Tondon ( supra ) .The judgment relied upon by the learned Counsel for the appellants in the case of Satyawati Tondon ( supra ) was pertaining to maintainability of writ petition under Article 226 of the Constitution. We have no hesitation to agree with the prepositions laid down in the above cited judgment that whenever an alternate and efficacious remedy is available to the party invoking Article 226 of the Constitution, he cannot take recourse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cable to the facts of the present case, then/the argument of the learned Counsel for the appellant that Writ Petition was not maintainable would merit consideration. Therefore, at this stage, we will not consider the matter regarding maintainability of the Writ Petition, as first we have to look to the provisions of section 11B of the Act and then decide whether Section 11B is applicable to the facts of the case as finding thereon would have bearing for considering the issue of maintainability of Writ Petition. Section 11B of the Central Excise Act reads as under : "11B. Claims for refund of duty : (1) Any person claiming refund of any duty of excise may make an application for refund of such duty to the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise before the expiry of one year from the relevant date in such form and manner as may be prescribed and the application shall be accompanied by such documentary or other evidence (including the document referred to in Section 12A) as the applicant may furnish to establish that the amount of duty of excise in relation to which such refund is claimed was collected from, or paid by, him and the incidence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. In other words, mere payment of amount would not make it a "service tax" payable by them. When once there is lack of authority to demand "service tax" from the respondent company, the department lacks authority to levy and collect such amount. Therefore, it would go beyond their purview to collect such amount. When once there is lack of authority to collect such service tax by the appellant, it would not give them the authority to retain the amount paid by the petitioner, which was initially not payable by them. Therefore, mere nomenclature will not be an embargo on the right of the petitioner to demand refund of payment made by them under mistaken notion. 20. In the case of Hind Agro Industries Ltd. ( supra ) it was the case where cess amount was paid under protest by the appellants. In that case after referring to Mafatlal Industries Ltd.'s case ( supra ), the lordships of Delhi High Court have held that in Mafatlal Industries Ltd.'s case ( supra ). Hon'ble Supreme Court was dealing with the case of refund of duty payable within the meaning of either the Central Excises and Salt Act, 1944 or the Customs Act, 1962 as the case may be, wherein they have held that al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ider this payment as service tax and duty payable, automatically, Section 11B would be applicable. When once there was no compulsion or duty cast to pay this service tax, the amount of Rs. 1,23,96,948/- paid by petitioner under mistaken no objection, would not be a duty or "service tax" payable in law. Therefore, once it is not payable in law there was no authority for the department to retain such amount. By any stretch of imagination, it will not amount to duty of excise to attract Section 11B. Therefore, it is outside the purview of Section 11B of the Act. 24. The learned Counsel for the appellant has also contended that when the order of refund was rejected, the respondent could have approached this Court instead of filing the appeal choosing a wrong forum, could not be a deficit coming in the way to claim refund. 25. However, the petitioner has not approached the Tribunal after the order passed by 1st appellate authority and they have approached this Court. Therefore, even the provisions of Section 35B(1)(b) would not be applicable. From the facts of the case as discussed herein above, it emerges that petitioner has approached this Court contending that Section 11B is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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