Cce, Kanpur vs M/S Kay Trading

(Arising out of the Order-in-Appeal No. 211-ST/APPL/KNP/2009 dated 06/07/09 passed by the Commissioner (Appeals), Customs & Central Excise, Kanpur).

For approval and signature:

Honble Mr. Justice G. Raghuram, President

Honble Mr. H.K. Thakur, Technical Member

1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 26 of the CESTAT (Procedure) Rules, 1982?

2 Whether it should be released under Rule 26 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

CCE, Kanpur . Appellant

vs.

M/s Kay Trading ] .... Respondents

M/s Young Style Overseas ]

Appearance:

S/Shri Govind Dixit and B.B. Sharma, A.R.s  for the appellant/Revenue.

None  for the Respondents.

Coram: Honble Mr. Justice G. Raghuram, President

Honble Mr. H.K. Thakur, Technical Member

Final Order No. 52188-52189/2015 dated 07/07/2015

Per. H.K. Thakur :-

Appeal No. ST/208/2010 has been filed by Revenue against OIA No. 211-ST/APPL/KNP/2009 dated 06/07/2009. Appeal No. ST/209/2010 has also been filed by Revenue against OIA No. 178-ST/APPL/KNP/2009 dated 08/06/2009. As the issue involved in both these appeals is the same, therefore, both are taken up for disposal under this common order.

2. Shri Govind Dixit (AR) and Shri B.B. Sharma (AR) appeared in these proceedings on behalf of the Revenue. It was argued that First Appellate Authority has held that refund claim cannot be rejected as time barred in view of CBEC Circular No. 137/84/2008  CX dated 12/03/2009. That Commissioner (Appeals) has wrongly applied the ratio of CBEC Circular dated 12/03/2009 to refund of service tax paid on commissions while sanctioning refund @ 10% of FOB instead of 2% of FOB. It was strongly argued by learned ARs that amending Notification No. 33/2008-ST dated 07/12/2008 will be effective from 07/12/2008 only and cannot be given retrospective effect as interpreted by the First Appellate Authority.

3. None appeared for the respondent whom notice of hearing was issued. There is also no request for any adjournment.

4. Heard learned ARs and perused the case records. The only issue required to be deliberated in these proceedings is whether respondents were eligible to refund @2% of FOB value on Commission Agent Service or 10% of FOB value as a result of amending Notification No. 33/2008-ST dated 07/12/2008, carried out in Notification No. 41/2007-ST dated 06/10/2007. As per Notification No. 41/2007-ST dated 06/10/2007 before its amendment, a refund equivalent to 2% of FOB value of the commission was admissible. As a result of amendment to Notification No. 41/2007-ST, as a result of Notification No. 33/2008-ST, made the refund admissible @ 10% from 2% admissible earlier. Commissioner (Appeals) has held that amendment in the rate of refund admissible w.e.f. 07/12/2008 will have retrospective on the analogy of CBEC File No. 137/84/2008-CX dated 12/03/2009 CBEC where it has been clarified that the benefit of amendment made in Notification No. 41/2007-ST, regarding extending of time limit for filing refund claim, can be given retrospectively. It has thus been held by the First Appellate Authority that if one amendment to Notification No. 41/2007-ST can be given retrospective effect then admissibility of refund @ 10% by an amendment with effect from 07/12/2008, should also be given retrospective effect. We do not agree with the findings of Commissioner (Appeals) as any amendment to a notification will have only prospective effect unless specifically made retrospective by the appropriate authority. No notification can be given retrospective by an executive instruction. Accordingly we allow the appeal filed by the Revenue by setting aside the order-in-appeal passed by the First Appellate Authority.

(Operative part of the order pronounced in the open court.)

andl

(Justice G. Raghuram)

President

(H.K. Thakur)

Technical Member

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