The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal observed that statutory limitation period under Section 11B Central Excise Act, 1944 not applicable to service tax refund when amount paid is not tax
M/s OIL India Ltd. (‘the Appellant’) is engaged in the exploration and production of Crude Oil and Natural Gas falling under Chapter 27 of the Central Excise Tariff Act, 1975. The Appellant entered into arrangements with two foreign entities, incorporated abroad for the receipt of certain services.
The Appellant filed refund claim of the total Service Taxpaid by it on the aforesaid transactions. Thereafter it received Show Cause Notice proposing to reject its claim on certain grounds. It was alleged that the appellant failed the bar of unjust enrichment. It was also alleged that, there was no evidence of double payment and in any event the refund claim filed was time barred.
Krishna Rao, Advocate appeared for the Appellant and K. Chowdhury, Authorized Representative appeared for the Revenue.
The Counsel for the appellant submitted that the appellant discharged Service Tax under reverse charge, on the aforesaid transactions under a mistaken apprehension. Since it was never liable to discharge Service Tax to begin with, the amount paid by it under mistake of law, was never a ‘tax’. That being so, all trappings that apply to a ‘tax’, including that of limitation under Section 11B,of the Central Excise Act were not applicable to the Appellant’s refund claim.
The Authorized Representative for the Department supported the Orders passed by the concerned authorities. He also relied on several judgments to contend that the conditions and prescriptions of Section 11B of the Central Excise Act, would apply to amounts paid by assessees under a misinterpretation of the statutory provisions.
The Tribunal of PK Choudhary, Judicial Member observed that “The statutory limitation period prescribed under Section 11B of the Central Excise Act, is not applicable to the refund claimed by the Appellant since the amount paid by the Appellant is not a tax.”
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