all the documents pertaining to the refund claim filed on the last date makes the refund ineligible?

PJ/Case Laws/2010-11/1016

Case: Regency Ceramics Ltd v/s Commissioner of C. Ex., Visakhapatnam

Citation: 2010 (20) STR 664 (Tri–Bang)

Issue:- Whether all the documents pertaining to the refund claim filed on the last date makes the refund ineligible?

Brief facts:- Appellant are engaged in manufacture and export of ceramic tiles. For service tax paid on transportation of export goods from January, 2008 to March, 2008, the appellant filed refund claim under Notification No. 41/2007-ST, dated 6/10/2007.

The Adjudicating Authority restricted the refund claim and disallowed refund for a short amount as it was found that said amount claimed did not pertain to the relevant quarter.

Notification No. 41/2007-ST was amended by the Notification No. 3/2008-ST, dated 19.02.2008. By this amendment, the exemption allowed in the original Notification was also extended to service tax paid for transportation of export goods from the place of removal to the ICD. The Original Authority allowed both the claims of the appellants.

The Commissioner initiated revision proceedings under Section 84 of the Finance Act, 1994 and passed an order demanding recovery of total amount sanctioned and paid to the appellant. The Commissioner discussed the appellant’s entitlement to claim for refund relatable to transport of goods from the place of removal to the ICD. The Commissioner found that the appellant had filed the refund claim on the 59^th day of the end of the quarter but the tax due was credited to the nominated bank only on the 60^th day.

Against this revision order, appellant has filed appeal before the Tribunal.

Appellant’s Contentions:- Appellant contended that they had filed the complete refund claim with necessary documents as prescribed in the Notification within the 60 days of the end of the quarter. Therefore, the Commissioner could not have held that the appellant was not entitled to the refund claim. As regards the claim relatable to transport of goods from ICD to port, the Commissioner has not given any findings in the impugned order.

Respondent’s Contention:- Revenue contended that the appellant had filed the refund claim without having paid the service tax as required under the Notification. As regards the claim, Revenue submitted that it is not clear from the impugned order whether the appellant had filed documents substantiating the claim. Revenue submitted that the matter may be remanded back for examination by the Original Authority.

Reasoning of Judgment:-The Tribunal found that the appellant had filed claim with the Authorities on 29.05.2008 and vital document necessary to sanction the claim viz. TR6 challan for proof of payment of service tax was furnished with the Authorities only on 30.05.2008. The submission of the appellant is that copy of the challan could not be obtained from the concerned bank owing to connectivity problem on 29.05.2008. However, the Department was in possession of the refund claim with all the necessary documents on 30.05.2008.

The Tribunal found considerable merit in the submission of the appellant and accepted it. It was held that the appellant had satisfied all the conditions of the Notification to qualify for the refund allowed by the Original Authority. As regards the balance amount, the Tribunal held that the impugned order does not give any reason why the same has to be recovered from the appellants.

The Tribunal held that the Original Authority had analysed the entitlement of the appellant to the entire claim with reference to the terms of the Notification and found them to be eligible for refund of both the amounts. Impugned order set aside.

Decision:- Appeal allowed with the consequent relief.

Comments:- This is a very good decision where the refund claim is allowed by the Tribunal under Notification No. 41/2007-ST.

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PJ/Case Laws/2010-11/1016

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