‘Relevant date’ for considering the refund claim as time barred under Notification no. 41/2007-S.T.

PJ/CASE LAW/2016-17/3202

Case-COMMISSIONER OF C. EX. & S.T., KANPUR Versus PACIFIC LEATHER FINISHERS

Citation-2016 (43) S.T.R. 273 (Tri. - All.)

Brief Facts-The Revenue is in Appeal against order-in-appeal No. 467/ST/APPL/KNP/2010, dated 13-9-2010 passed by Commr. of Customs & C. Ex., Kanpur. The respondent-assessee is an exporter and availed service of commission agent for procuring export order, which is payable to such agent at the rate of 2.7% of FOB value. For the export made between the dates (let export order) between 19th April, 2008 to 2nd July, 2008, the appellant filed refund claim under Notification 41/2007 on 30-3-2009. A show cause notice dated 4-5-2009, was issued as it appeared to Revenue that the refund claims are time-barred. The appellant-assessee contested the show cause notice, but the same was confirmed observing that the period of refund claim is six months from end of the quarter, in which export was made and accordingly, the appellants claims being were time-barred and also for the reason of claiming drawback in few instances. Being aggrieved, the assessee preferred an appeal before the ld. Commissioner (Appeals), who in the impugned order, allowed the appeal on the ground that the adjudicating authority have travelled beyond the show cause notice, as their claiming drawback was not the issue in show cause notice. So far as the time-bar is concerned, he decided the same in favour of the assessee observing that since it is undisputed fact that the appellants had paid commission during quarter from July to September, 2008 and the service tax involved therein was paid on October, 2008, the refund claim cannot be held to be time barred, before the right to claim arose.

Appellants Contention-Being aggrieved, the Revenue is in appeal on the ground that under the condition of Notification, the time limit prescribed is six months from the quarter, exports took place.

Respondents Contention-The respondent assessee is absent today in spite of notice. Tribunal find that the respondent was also absent on the previous date i.e. 18-9-2015 without any representation for time. Under these circumstances, the appeal is taken up for hearing with the assistance of the ld. AR for the Revenue.

Reasoning Of Judgement-Heard the ld. AR for the Revenue and perused the records. Having considered the rival contentions, tribunal find that the issue of time bar in this appeal is no longer res integra, and is decided by the Hon'ble Delhi High Court in the case of Sony India Ltd. - 2014 (304)E.L.T.660 (Del), wherein the Hon'ble High Court has held that the limitation cannot start to run unless right to receive a claim or refund crystallized. In the present case, the right to claim/refund under Notification No. 41/2007-S.T. crystallized only when the service tax was deposited in October, 2008. Thus, the refund claim was filed within six months on 30-3-2009. Accordingly, they hold that the refund claim is within time. In view of the above findings, they dismiss the appeal of the Revenue and confirm the order-in-appeal. The respondent assessee will be entitled to consequential benefit, if any, in accordance with law.

Decision-Appeal dismissed

Comment-The gist of the case is that the ‘Relevant date’ for computing six months period under Notification No. 41/2007-S.T. to be taken from the date when Service Tax was paid. It cannot be computed from the first day of month following quarter in which exports made as alleged by the department. And since in the given case assessee filed claims within six months from date of payment of Service Tax, the same is not time barred.

Prepared By-Neelam Jain

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PJ/CASE LAW/2016-17/3202

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