By TIOL News Service

KOLKATA, MAY 29, 2017: THE appellant had filed refund claims in respect of Service Tax paid by them under Works contract service for the various works executed by them for the Govt. of West Bengal and its various agencies for laying of pipelines for water supply, sewerage lines etc. It is the case of the appellant that they are not liable to pay Service Tax.

The refund claims were rejected on the ground of time bar and unjust enrichment and that the appellant had availed abatement benefit and, therefore, are not entitled to refund.

The Commissioner(Appeals) observed that although the lower authority had rejected the refund claim as hit by the doctrine of unjust enrichment since the refund amount was not ordered to be credited to the Consumer Welfare Fund, the matter was remitted.

Aggrieved, the appellant is before the CESTAT.

After considering the elaborate submissions made by the appellant, the Bench observed noted that there is no dispute that the Service Tax was collected wrongly from the appellant during the period 2007-08 and 2008-09;that both the authorities below denied the refund claim on the ground that a part of the refund claim is barred by limitation beyond the period of one year from the date of deposit of Service Tax as evident from GAR-7 challans.

Adverting to the decisions in Jubilant Enterprises Pvt. Ltd. - 2014-TIOL-702-CESTAT-MUM, Shankar Ramchandra Auctioneers - 2010-TIOL-632-CESTAT-MUM, Geojit BNP Paribas Financial Services Ltd. - 2015-TIOL-1602-HC-KERALA-ST, Hexacom (I) Ltd. - 2006-TIOL-1334-CESTAT-DEL, Amadalavalasa Cooperative Sugars Ltd. - 2007-TIOL-774-CESTAT-BANG M/s. Monnet International Ltd. & Another - 2017-TIOL-1023-CESTAT-DEL, the CESTAT held -

"14. On perusal of the above decisions…, it is seen that the limitation under section 11B of the Central Excise Act would not be applicable in case of payment of tax mistakenly. Further, the principle of unjust enrichment would not apply in the case of composite contract price, as applicable in the present case. …I have also seen the sample invoices placed by the appellants….Therefore, the appellant is entitled to get the refund of tax as claimed by them."

The appeal was allowed with consequential relief.

(See 2017-TIOL-1782-CESTAT-KOL)