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Veer Overseas Limited. Versus CCE & ST Panchkula

2017 (9) TMI 458 - CESTAT CHANDIGARH

Refund of amount collected without authority of law - service tax which was exempt by N/N. 13/2003-ST dt. 20.06.2003 as amended - denial of refund on the ground that refund was filed beyond the statutory time limit of one year prescribed under Section 11B of the CEA, 1944 - Held that: - as a result of this clarification dt. 26.05.2011, the benefit of this exemption notification No. 13/2003 became available to the appellant and the amount collected by the Revenue was therefore without any authori .....

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e, the matter requires reference to the Hon’ble President for constitution of a Larger Bench - matter to the Hon’ble President for constitution of a Larger Bench of this Tribunal to decide the issue Whether in respect of the claim for refund of illegal levy of Service Tax or of Service Tax collected without authority of law, the statutory time limit prescribed in terms of Section 11B of Central Excise Act 1944 will be applicable or not? - matter referred to Larger Bench. - Appeal No. ST/320/2011 .....

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received from the Foreign Commission Agent under Business Auxiliary Services. The claims were filed on the ground that the said tax was paid by them inadvertently as the same was otherwise exempt under Notification No. 13/2003-ST dt. 20.06.2003 as amended. The said notification exempts Business Auxiliary Services provided by a Commission Agent in relation to sale or purchase of agricultural produce from the Service Tax leviable under Section 66 of the Finance Act, 1994. The appellants are in the .....

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two refund claims were filed on 01.02.2010 under Section 11B of the Act. He contended that the assessee deposited Service Tax on the service of Foreign Commission Agents for the export of rice, inadvertently which was exempted from payment of Service Tax. He relied on the Circular No. 143/12/2011-ST dt. 26.05.2011 issued by CBEC clarifying that the Business Auxiliary Service provided by Commission Agents stationed abroad to promote the export of rice is covered by the Notification No. 13/2003-ST .....

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abad-III Vs. XL Telecom Ltd. 2006 (206) ELT 303 (Tri. Bang.) in which it was held that statutory time limit was applicable even for refund of illegal levy and time limit could not be extended any authority or Court. He also relied on the case of Miles India Ltd. Vs AC, Customs, 1987 (30) ELT 641 (SC). 4. Heard the parties and perused the records. 5. I find that the Service Tax was paid in the category of the Business Auxiliary Services on account of payment of Service Tax for the Foreign Commiss .....

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agents stationed abroad were covered by the Notification No. 13/2003-ST. Hence, the first question is whether the Service Tax which was paid by the appellants was due to mistake of law. I find that the clarification dt. 26.05.2011 did not exist on the date of payment of the Service Tax. The amended Notification No. 13/2003, from which the clause (i) had been deleted, provided for the commission agents in relation to sale or purchase of agriculture produce from the Service Tax leviable thereon u .....

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to deposit Service Tax on the impugned service being recipient of service provided by foreign commission agents. Subsequently, they filed refund claim on 01.02.2010 contending that the Service Tax was paid inadvertently. However it was only on 26.05.2011 that a clarification was issued by the CBEC, which clarified that Also where the commission agents stationed abroad provide business auxiliary service to promote the export of rice, said business auxiliary service is covered by Notification No. .....

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vely while oppressive circular has to be applied prospectively. 6. However, on the question of limitation, I find that there are conflicting decisions of the Division Benches of this Tribunal on whether the statutory time limit under Section 11B of the Central Excise Act, 1944 is applicable to claim for refund of tax which was collected without authority of law. In the case of Monnet International Ltd. Vs. CCE, New Delhi (supra), relied upon the appellants, the Tribunal has held as below:- 17. T .....

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-2007 and the refund was filed on 02nd January, 2008. Hence, the claim has been made within the period of three years prescribed by Hon ble Delhi High Court. Therefore, we are of the view that the assessee-Appellants are entitled to get the refund and the same is not hit by the limitation prescribed under Section 11B of the Central Excise Act, 1944 read with Section 83 of the Finance act, 1994. 18. Moreover, it may be mentioned that the Department should not take advantage of the ignorance of th .....

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Hyderabad-III Vs. XL Telecom Ltd. 2006 (206) ELT 303 (Tri. Bang.), relied upon by the Revenue, the Division Bench of this Tribunal held as below:- 4. On a careful consideration, we notice that the Revenue has taken a well sustained ground. For the reason that the Apex Court in the case of Asst. Commissioner of Customs v. Anam (supra) had laid down in very clear terms that even in respect of claim for refund of an illegal levy , the statutory time limit prescribed in terms of Section 11B of CE Ac .....

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n of refund is concerned, it is obvious that it shall be governed by the law declared in Mafatlal Industries v. Union of India 1997 (89) E.L.T. 247 (S.C.) = 1996 (9) scale 457, read with Clause (6) of the format order, a copy of which is enclosed herewith, which is as follows : Where a refund application or an appeal is preferred under and in accordance with the directions (1), (2), (3) and (4) above, the same shall be entertained only if the applicant for refund/appellant files affidavit statin .....

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RMAT ORDER Pursuant to the directions given in Mafatlal Industries v. Union of India 1997 (89) E.L.T. 247 (S.C.) = 1996 (9) scale 457, the appeals/Special Leave Petitions coming up for disposal shall be disposed of in terms of one or the other of the clauses below : (1) Where a refund application was filed by the manufacturer/purchaser beyond the period prescribed by the Central Excise Act/Customs Act in that behalf, such petition must be held to be untenable in law. Even if in any appeal, suit .....

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f illegal levy cannot be extended by any Authority or Court. (2) Where, however, a refund application was filed within the period prescribed by the Central Excise Act/Customs Act but has been dismissed wholly or partly on any ground and the said order is questioned by way of a writ petition or a suit or any appeal arising therefrom the manufacturer/purchaser shall be entitled to withdraw the writ petition, suit or an appeal arising therefrom, as the case may be, and file an appeal before the app .....

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the ground of limitation and shall be dealt with in accordance with law. This direction shall apply even in cases where the High Court or Civil Court is approached after exhausting the remedy of appeal to Collector (Appeals). He can file an Appeal to C.E.G.A.T. within sixty days from today, after withdrawing the writ petition or the suit, as the case may be. (3) Where, however, a writ petition or suit claiming refund was filed directly in the High Court/Civil Court (i.e., without filing a refun .....

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shall be entitled to withdraw the writ petition, in which event, the Revenue appeal shall be disposed of permitting the writ petitioner to withdraw the writ petition to pursue the remedy proposed hereby. (4) The above rules, however, do not apply in the case of a claim for refund of duty levied and recovered under an unconstitutional provision. In such a case, the period of limitation shall be prescribed in Mafatlal Industries. The duty to allege and prove that the duty has not been passed on t .....

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6) Where a refund application or an appeal is preferred under and in accordance with the directions (1), (2), (3) and (4) above, the same shall be entertained only if the applicant for refund/appellant files affidavit stating that he has not passed on the burden of the duty, which is claimed by way of refund, to another person. In case the applicant for refund is a company or a society, the affidavit shall be sworn by the Managing Director of the Principal Officer of the Company or the Society, .....

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