TMI Blog2021 (11) TMI 837X X X X Extracts X X X X X X X X Extracts X X X X ..... of 2021 And Service Tax Appeal No. 89215 of 2018 - A/87183/2021 - Dated:- 16-11-2021 - HON BLE MR. SANJIV SRIVASTAVA, MEMBER (TECHNICAL) AND HON BLE DR. SUVENDU KUMAR PATI, MEMBER (JUDICIAL) Shri S.V. Nair, Consultant, for the Appellant Shri Nitin Ranjan, Deputy Commissioner, Authorised Representative for the Respondent ORDER PER: SANJIV SRIVASTAVA This appeal is directed against the order in appeal No PUN-EXCUS- 001-APP-90/2018-19 dated 08.06.2018 of the Commissioner (Appeals-I), Central Tax, Pune. By the impugned order, the Commissioner (Appeals) has upheld the order in original No PI/ Talegaon Divn/ref-ST/234/17-18 dated 08.01.2018 of the Assistant Commissioner, Talegaon Division rejecting the refund claim filed by the Appellant claiming refund of ₹ 4,43,827/-. 2.1 The appellant has also filed a miscellaneous application for change of name of the proprietor. The same is dismissed as infructuous. 2.2 Appellant holds service tax registration for providing taxable services (under the category of Renting of Immovable Property Services). 2.3 Appellant preferred a refund claim for an amount of ₹ 4,43,827/- (Rupees Four Lakh Forty Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pugned order cannot be sustained and their appeal be allowed. 3.3 Arguing for the revenue, learned authorized representative reiterated the findings recorded by the Commissioner (Appeal) in the impugned order. He submits that- Benefit of Sl No 18 of exemption notification is not available, as Hostels do not qualify as per the terms used in this entry. Hostel is a very specific term used in relation to the educational institutions. The services provided by or to the educational institutions are exempted vide entry at Sl No 9 of the notification No 25/2012-ST. However the services of Hostel do not figure in the said entry. The refund claim has been rightly rejected by the authorities below denying the benefit of the exemption claimed by the appellants. Even if the refund claim is held to be admissible, then also same cannot be made without Assistant Commissioner recording his satisfaction to effect that burden of the tax paid has not been passed on by the appellants to the service recipients. 4.1 We have considered the impugned order along with the submissions made in appeal and during the course of arguments. 4.2 The Sl No 18 of the notification No 25/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivities - called also youth hostel 3 chiefly British : a supervised institutional residence or shelter (as for homeless). iii. Wikipedia Dictionary: Hostels provide budget-oriented, sociable accommodation where guests can rent a bed, usually a bunk bed, in a dormitory and share a bathroom, lounge and sometimes a kitchen. Rooms can be mixed or single-sex, and private rooms may also be available. Hostels are often cheaper for both the operator and occupants; many hostels have long-term residents who they employ as desk agents or housekeeping staff in exchange for experience or discounted accommodation. In a few countries, such as the UK, Ireland, Nepal, India and Australia, the word hostel sometimes also refers to establishments providing longer-term accommodation. In India, Pakistan and South Africa, hostel also refers to boarding schools or student dormitories in resident colleges and universities. In other parts of the world, the word hostel mainly refers to properties offering shared accommodation to travelers or backpackers. iv. Cambridge Dictionary Inn: noun [C] IN UK: a pub where you can stay for the night, usually in the countryside In Us a small hotel, u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se, club or campsite, by whatever name called, for residential or lodging purposes, used at sl No 18 in the Notification No 25/2012-ST dated 20.06.2012, is wide enough to bring in its ambit the word Hostel as commonly understood. In view of this we do not see any reason for denying the benefit of the exemption under this entry. 4.5 We also note that we are in the present appeal concerned with the refund claims filed by the appellant. In case of Mafatlal Industries {1997 (89) ELT 247 (SC)], a Constitutional Bench of the Hon ble Apex Court has laid down the law as follows: 82.A good amount of debate took place before us on the question whether sub-section (3) makes Section 11B exhaustive of all kinds of refund claims including those which are refundable as a consequence of appellate/revisional order and/or as a consequence of orders made by the High Court/Supreme Court. Sri Nariman pointed out that in Rule 11 (as it was in force during the period August 6, 1977 to November 17, 1980), sub-rule (3) expressly provided that where as a result of any order passed in appeal or revision under the Act, refund of any duty becomes due to any person, the proper officer may refund the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nst the very grain of the entire philosophy underlying the 1991 Amendment. The idea underlying the said provisions is that no refund shall be ordered unless the claimant establishes that he has not passed on the burden to others. Sub-section (3) of the amended Section 11B is emphatic. It leaves no room for making any exception in the case of refund claims arising as a result of the decision in appeal/reference/writ petition. There is no reason why an exception should be made in favour of such claims which would nullify the provision to a substantial degree. So far as lack of incentive argument is concerned, it has no doubt given us a pause; it is certainly a substantial plea, but there are adequate answers to it. Firstly, the rule means that only the person who has actually suffered loss or prejudice would fight the levy and apply for refund in case of success. Secondly, in a competitive market economy, as the one we have embarked upon since 1991-92, the manufacturer s self interest lies in producing more and selling it at competitive prices - the urge to grow. A favourable decision does not merely mean refund; it has a beneficial effect for the subsequent period as well. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me. We see no unreasonableness in saying so. 4.6 In case of Addisson Co [2016 (339) ELT 177 (SC)] Hon ble Supreme Court laid down the law as under 16. In the instant case, the Assessee has admitted that the incidence of duty was originally passed on to the buyer. There is no material brought on record to show that the buyer to whom the incidence of duty was passed on by the Assessee did not pass it on to any other person. There is a statutory presumption under Section 12B of the Act that the duty has been passed on to the ultimate consumer. It is clear from the facts of the instant case that the duty which was originally paid by the Assessee was passed on. The refund claimed by the Assessee is for an amount which is part of the excise duty paid earlier and passed on. The Assessee who did not bear the burden of the duty, though entitled to claim deduction, is not entitled for a refund as he would be unjustly enriched. It will be useful to refer to the relevant para of Mafatlal Industries v. Union of India (supra) in this connection. 108. (iii) A claim for refund, whether made under the provisions of the Act as contemplated in Proposition (i) above or in a s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Central Government. There is no dispute about the fact that no notification has been issued by the Central Government as contemplated in Clause (f) to proviso to Section 11B(2) of the Act. He contested that the claim for refund can be made only by the manufacturer or his buyer and any enquiry pertaining to unjust enrichment should be restricted only to the manufacturer and his buyer. The ultimate buyer/consumer will not figure in the scheme of Sections 11B, 12A, 12B and 12C of the Act. This submission was accepted by the High Court in the impugned judgment. We do not approve the findings of the High Court in this regard. 19. The sine qua non for a claim for refund as contemplated in Section 11B of the Act is that the claimant has to establish that the amount of duty of excise in relation to which such refund is claimed was paid by him and that the incidence of such duty has not been passed on by him to any other person. Section 11B(2) provides that, in case it is found that a part of duty of excise paid is refundable, the amount shall be credited to the fund. Section 2(ee) defines Fund to mean the Consumer Welfare Fund established under Section 12C. There is a proviso ..... X X X X Extracts X X X X X X X X Extracts X X X X
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