In a major relief to the Delhi and District Cricket Association, the Delhi High Court has allowed a petition seeking refund of excess service tax along with interest.
The department passed an order stating that the petitioner Association had short paid towards tax, an amount equivalent to Rs.2,15,39,257/- and 1,03,05,282/-. The petitioner approached the High Court stating that the demand was more than Rs.50,00,000/- and no consultation prior to issuance of show-cause notice took place in the instant matter, contrary to the provisions of the master circular dated 10.03.2017, issued by the Central Board of Excise and Customs.
Justice Rajiv Shakdher and Justice Tara Vitasta Ganju has held that “since the amounts and period involved are not in dispute and because the adjudicating authority has not furnished an acceptable reason as to why the amount paid towards tax and cess i.e., Rs.36,27,615/- [Rs.36,94,642/- less Rs.67,027/] is not refunded, we are inclined to allow the writ petition insofar as the refund of the actual excess amount paid by the petitioner on account of the service tax and cess is concerned.”
The Court further held that it is not in dispute that statutory interest gets triggered under Section 11BB of the 1944 Act, once the stipulated period for refund of the amount gets over. In this case, the stipulated period is three months commencing from the date of receipt of an application under sub-section (1) of Section 11BB of the 1944 Act.
Allowing the refund along with interest, the High Court observed that “in our opinion, there cannot be any estoppel against a statute. Once the statute provides for payment of interest and the stipulated conditions are fulfilled, the respondent/revenue would be obliged, in law, to pay the interest.”
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