TMI Blog2016 (10) TMI 656X X X X Extracts X X X X X X X X Extracts X X X X ..... nces, the taxability of brokerage of mutual funds was left to quasi-judicial determination. The appellant had paid taxes due till July 2004, along with interest, in two tranches to cover the entire receipts from Asset Management Companies but sought refund of thee amount paid as second installment. Refund of earlier installment had been remanded by the first appellate authority for disposal on merits. The authority empowered to decide on the refund application has chosen to use the investigation initiated by the Directorate General of Central Excise Intelligence to refrain from exercising its obligation under the Finance Act, 1994 read with section 11B of the Central Excise Act, 1944. This casual disposal is prone to further intervention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... four weeks. The appeal is allowed by way of remand for strict compliance. - ST/85128/2013 - A/85842/16/SMB - Dated:- 18-2-2016 - Shri C J Mathew, Member (Technical) Shri Harish Bindumadhavan, Advocate for the appellant Shri A.B. Kulgod, Asstt. Commissioner (AR) for the respondent ORDER M/s Blue Chip Investment Centre Ltd, who describe themselves as commission agent , acts as intermediary between Asset Management Companies (AMC) and retail investors and, therefore, obtained registration as provider of business auxiliary services on 22nd January 2004. Business auxiliary services was made taxable from 1st July 2003 vide section 65(105)(zzb) of Finance Act, 1994 and included commission agent within the definitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8377; 15,88.871/- on brokerage of Mutual Funds for the period from 1st July 2003 to 31st March 2004 after excluding trail fees and out of pocket expenses from their receipts. The Hon ble High Court of Delhi, in its decision in M/s Bajaj Capital Ltd v Union of India others [WP No 6936/04 dated 7th May 2004], held this circular to be invalid. M/s Blue Chip Investment Centre Ltd sought refund of tax paid which was rejected by the competent authority vide its order dated 1st February 2007. Commissioner of Central Excise (Appeals), Mumbai Zone I, holding that the grounds of rejection were procedural, by order dated 15th December 2010, remanded the matter back to the original authority for deciding the claim on merits. The outcome is not kn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... did not participate in the proceedings. The appellant asserts that their representative had attended the personal hearing on 19th January 2012 and furnished written submission; the observation of the appellate authority made it apparent that their contentions had been ignored in arriving at the decision in the impugned order. 5. It was also contended that the finding of the original authority, endorsed in the impugned order, was contrary to circular no. 96/7/2007-ST dated 23rd August 2007 which has categorically described the activity of the appellant as taxable under section 65(105)(zzb) of Finance Act, 1994 and that the action of the original authority in attempting to reclassify the services is not correct in law. It was also submitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt Companies but sought refund of thee amount paid as second installment. Refund of earlier installment had been remanded by the first appellate authority for disposal on merits. The authority empowered to decide on the refund application has chosen to use the investigation initiated by the Directorate General of Central Excise Intelligence to refrain from exercising its obligation under the Finance Act, 1994 read with section 11B of the Central Excise Act, 1944. This casual disposal is prone to further intervention by attempt to reclassify the nature of the service through the disposal of refund claim, in a manner that is contrary to the principles of natural justice and in direct contravention of the circular of Department of Revenue issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t be out of place to mention that, with the rejection of the refund claim, the application ceases to exist and a fresh application would, undoubtedly, be rejected as barred by limitation of time. This would compounds the irresponsibility that has already caused sufficient travails to the assesse. This action on the part of the original authority cannot but be viewed with disfavour. Nor can the endorsement by the first appellate authority find favour. 12. The impropriety of the original authority can be remedied only by remand back to that official to consider the refund application on merit without awaiting the outcome of the notice issued by Directorate of Central Excise Intelligence. Lest that authority be tempted to deny the refund on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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