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2015 (5) TMI 454

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..... refund subject to fulfilment of the statutory requirement under Section 11B read with Section 12A and 12B of the Central Excise Act, 1944. On a conjoint reading of these provisions, the legislative trajectory is clear, that a claimant for refund of tax is required to establish that the burden of service tax (an indirect tax) was not passed on. If there is a passing of the burden, the doctrine of unjust enrichment kicks in and a refund claim would not be admissible nor can Revenue retain such amount. Even if there be unjust enrichment, the un- authorised tax remitted by an assessee or collected by the Government cannot be retained but must be credited to the Consumer Welfare Fund. Despite a series of correspondence between the assessee a .....

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..... iability thereon. The assessee represented to the Government for a clarification whether its activities were leviable to service tax. In response, the Ministry of Finance vide the letter dated 24.05.2010 clarified that the activity of construction of residential complexes by the assessee , being intended for personal use of employees / Ministers of the Government of India, was not a taxable service. 3. Within a month of the Government clarification dated 24.05.2010, on 21.06.2010 the assessee presented its claim for refund of ₹ 30 ,06,796 /, being the service tax and interest earlier remitted by it on a misconception that it was liable to service tax and for interest for late remittance of such tax. 4. After the refund claim a s .....

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..... essee's claim for refund of ₹ 17 ,62,649 /- be considered by the primary Authority after verifying the relevant documents, to ascertain that the burden of service tax was not passed on and element of unjust enrichment was inapplicable to deny refund. In so far as the refund to the other extent of Rs . 12,74,147/- is concerned, the appellate Authority fell into the same error as the primary authority, namely that the appellant was required to furnish details such as the name of the sub-contractor who executed the actual work on assignment by the assessee . Another reason recorded by the appellate Authority for denying this quantum of the claim was that a certificate regarding not passing on the burden of service tax by the assessee .....

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..... tax is required to establish that the burden of service tax (an indirect tax) was not passed on. If there is a passing of the burden, the doctrine of unjust enrichment kicks in and a refund claim would not be admissible nor can Revenue retain such amount. Even if there be unjust enrichment, the un- authorised tax remitted by an assessee or collected by the Government cannot be retained but must be credited to the Consumer Welfare Fund. This principle is well established. 8. Section 12B of the 1944 Act enacts a presumption that a duty of excise (or service tax) remitted has been passed on to the buyer of goods (or the recipient of the service). Section 12B is made applicable to service tax under Section 83 of the Finance Act, 1994. The sy .....

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