The Kolkata bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that refund claims filed on account of Service Tax paid by mistake, are not governed by the time limit specified under Section 11B of the Central Excise Act,1944.
Bansal Biscuits Private Limited, the appellant assessee are manufacturer of biscuits and apart from being registered under Central Excise, they are also registered with Service Tax Authorities for paying Service Tax under the Reverse Charge Mechanism for the Goods Transport Agent (GTA) services utilized by them. They were paying Service Tax on a Reverse Charge basis on GTA Services.
The assessee appealed against the order passed by the Adjudicating Authority for rejecting the refund claim under Section 11B of the Central Excise Act read with Section 83 of the Finance Act, 1994.
Ankit Kanodia and Megha Agarwal, the counsels for the assessee contended that the assessee had paid the Service Tax which was not required to be paid in the first place. In such a case, it had been held by the various Tribunals and the Supreme Court that when Service Tax has been paid by mistake, the provision of Section 11B of the Central Excise Act could not be applicable.
K. Chowdhury, the counsel for the department contended that when the refund claim was filed beyond one year from the date of payment of tax, it was barred by limitation.
The Bench observed that in the case of Commissioner Vs. KVR Construction, the court held that the refund claims filed on account of Service Tax paid by mistake, are not governed by the time limit specified under Section 11B of the Central Excise Act and in the present case the provisions of Section 11B of the Central Excise Act (time limit) would not be applicable.
The two-member bench comprising Muralidhar (Judicial) and Anpazhakan (Technical) held that Section 11B of the Central Excise Act is not applicable which would also include the provisions of ‘Unjust Enrichment’ under Section 11B not being applicable in respect of such refund cases.
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