TaxTMI 
TaxTMI 
2019 (8) TMI 387
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.... a non-banking financial Corporation. The respondent offers sector specific knowledge based customized solutions to its customers. Such service provided by the respondent is categorized as taxable service under the head "Banking and Other Financial Services", defined under the Finance Act, 1994. The respondent is registered with the service tax department for providing such taxable service. For the purpose of providing such output service, the respondent avails the input services provided by the service providers located both within and outside the country. As per the provisions of Section 66A ibid, the respondent was liable to pay service tax as a recipient of service received from overseas entities w.e.f. 18.04.2006. However, during the course of audit, the service tax department insisted that the respondent should discharge the service tax liability on foreign remittances made by it for the period from 01.01.2004 to 17.04.2006 in respect of the taxable services received by it. Though, the respondent did not agree with such interpretation placed by the service tax department, but to avoid interest liability and further litigation, had deposited the service tax amount of Rs. 3,12,....
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....redit and accordingly, the benefit of refund should not be available to the assesee. (c) That the Commissioner (Appeals) failed to consider that the case laws relied upon by the assessee had been reached finality in favour of the department in the higher forum on the same issue. 3. Shri M.K. Sarangi, the learned AR appearing for Revenue reiterated the submissions made in the appeal memorandum and further submitted that since the refund claim was filed under Section 11B ibid, the provisions contained therein have to be strictly construed and different interpretation cannot be placed by the authorities functioning under the statute. He further submitted that since the refund application was filed by the respondent and disposed of by the original authority as per the mandates of the statute, in rejecting the same on the ground of limitation, it cannot be said that such action on the part of the adjudicating authority is not in conformity with the statutory provisions. Accordingly, it was pleaded on behalf of Revenue that allowing the appeal in favour of the Respondent by the learned Commissioner (Appeals) is not proper and justified. In support of the Revenue's appeal, the learne....
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....vt. Ltd. Vs. CCE 2015 (40) STR 1066 (Del) (vii) Hind Agro Industries Ltd. Vs. CC 2008 (221) ELT 336 (Del) (viii) KVR Constructions Vs. CCE 2010 (17) STR 6 (Kar) (Single Judge) (ix) CCE Vs. KVR Construction 2012 (26) STR 195 (Kar) (Division Bench) 5. Heard both sides and examined the case records, including the written submissions filed during the course of hearing of appeal. 6. Liability for payment of service tax is fastened on the provider of taxable service, as per the provisions of Section 68 ibid. Sub-section (2) of Section 68 ibid provides that in respect of the taxable services as may be notified, the service tax thereon shall be paid by such person in such manner as may be prescribed. Payment of service tax by the recipient of service under reverse charge mechanism was notified on 18.04.2006, by inserting Section 66A in the statute book by Finance Act, 2006 (21 of 2006). However, clause (d)(iv) was inserted in sub-rule (1) of Rule 2 of the Service Tax Rules, 1994 providing that in relation to any taxable service provided or agreed to be provided by any person, located in a non-taxable territory and received by any person located in the taxable territory, the re....
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....d refund claim is the actual date of payment of service tax, which admittedly had not been complied with by the respondent. Accordingly, the refund application was rejected by the original authority on the ground of limitation and subsequently, such order was upheld by the learned Commissioner (Appeals) on the ground that mere deposit in the hands of Government cannot be termed as payment of service tax and thus, the bar of limitation would not be applicable to such refund claim. 9. The statutory provisions dealing with the issue of claim of refund of duty both under the erstwhile and the present set of Acts and Rules were highly contentious, opened to divergent interpretations. There were conflicting views on the subject by the judicial forums, concerning the issues such as, refund of duties collected contrary to the provisions of law, interpretation of Article 265 of the Constitution of India, the provisions of Central Excise and Customs Act etc. Finally, the disputed issues were resolved by the Constitutional Bench of Hon'ble Supreme Court in the classic case of Mafatlal Industries Ltd. (supra). The issues considered by the Hon'ble Apex Court, relevant for resolving th....
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....sions of Section 11B ibid squarely apply to the case in hand for necessary compliance by the respondent. Since, the refund application was not filed within the stipulated time frame of one year from the relevant date, the original authority had correctly rejected such claim application. 11. In this case, it is an admitted fact on record that being a registered service tax assessee, the respondent had discharged the tax liability under reverse charge mechanism, by depositing such tax amount into the Central Government account under proper accounting code. Thus, under such circumstances, it cannot be pleaded that service tax amount deposited by it should be construed as a 'mere deposit' in the hands of the Government and for grant of its refund, the provisions of Section 11B ibid would not be applicable. Further, for claiming refund of the disputed amount of service tax, the respondent had filed the refund application prescribed under Section 11B ibid and the said application was also considered and entertained by the original authority under the statutory provisions. Since, the statute clearly mandates that the refund claim has to be lodged within a period of one year from the rel....