Unknown vs Cst, Delhi

[Arising out of the Order-in-Appeal No.168/ST/DLH/2013 dated 17.7.13 passed by the CCE (Appeals), Delhi-I)

Date of Hearing/Decision: 11.2.2015

For Approval &signature:

HonbleMr.Ashok Jindal, Member (Judicial)

1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3. Whether their Lordships wish to see the fair copy of the order? seen 4. Whether order is to be circulated to the Department Authorities? Yes T T Ltd. Appellant

Vs.

CST, Delhi Respondent

Appearance

Shri Bimal Jain, CA- for the appellant

Shri Devernder Singh, A.R. - for the respondent

CORAM: Honble Mr.Ashok Jindal, Member (Judicial)

FINAL ORDER NO.50456/2015

Per Ashok Jindal :

The appellant is in appeal against the impugned order wherein refund claim has been rejected by the Commissioner (Appeals) confirming rejection of the refund claim by the adjudicating authority.

2. The brief facts of the case are that the appellant has filed six refund claims for Rs.47,77,492/- under Notification No.41/2007-ST dt.6.19.2007. The show cause notices were issued in respect of 5 refund claims on various grounds. Thereafter an adjudication order was passed rejecting the refund claims on following grounds:-

(a) Refund claims are filed beyond the period of limitation

(b) In some invoices do not contain requisite details as prescribed in rule 4A of Service Tax Rules, 1994.

(c) No evidence of payment made against the invoices on which refund is sought.

3. That order was challenged before the Commissioner (Appeals) who held that the refund filed for the period June, 2007 and September, 2007 are barred by limitation and for rest of refund claims, on merits, he held that the appellant is entitled for refund claim but he directed the adjudicating authority to verify certain documents. The said order was accepted by the Committee of Commissioners. When the appellant approached to the adjudicating authority for sanctioning of refund claim as per direction of the Commissioner (Appeals), they produced the documents as directed the adjudicating authority without intervened in the order passed by the Commissioner (Appeals), the adjudicating authority sanctioned the refund claim of Rs.8,48,422/- and taken no grounds for rejection of the refund claim and rejected the refund claim of Rs.34,95,654/-. On appeal before the Commissioner (Appeals), the order of rejection of refund claim was upheld. Therefore, the appellant is before me.

4. Learned Consultant for the appellant submits that in earlier round of litigation, the order of sanctioning of refund claim has been accepted by the department. Therefore, without challenging the said order, the adjudicating authority has no right to raise new issue to reject the refund claims. Therefore, the Commissioner (Appeals)s order is required to be set aside. To support his contention, he relied on the decision of Apex Court in the case of ITC-2006 (204) ELT 363 (SC). He further submits that the adjudicating authority cannot re-assess and re-quantify the amount of refund as per appellate order without challenging the same. To support this contention, he relied on the decision of Honble High Court of Allahabad in the case of Samtel Color Ltd.-2014 (49) taxmann.com 238 (Allahabad). He submits that the refund claims were rejected on new a ground which was neither alleged specifically in the show cause notice nor there was specific finding in the adjudication order as well as in the appellate order. To support this contention, he relied on the decision of this Tribunal in the case of Dhampur Sugar Mills Ltd.-2010 (260 ELT 271 (Tri.-Del) On merits, he submits that refund claims have been denied in the second round of litigation on the premise that at the time of export of goods, the services availed by the appellant were not specified services as per Notification No.41/2007-ST. For this purpose, he submits that refund claims cannot be denied merely on the ground that the export related to prior to notification/amended in the notification. To support this contention he relied on the decision of the Tribunal in the case of WNS Global Pvt.Ltd.-2008 (10) STR 273 (Tri.-Mum.) which has been affirmed by Honble Bombay High Court reported in 2011 (22) STR 609 (Bom).

5. On the other hand, learned AR opposes the contention of the ld.Consultant and submits that in this case the Commissioner (Appeals) has not simply sanctioned the refund claim but he has directed the appellant to produce certain documents and thereafter the adjudicating authority having every right to examine those documents and denied the refund claim. He drew my attention to certain paras of the impugned order of Commissioner (Appeals) sanctioning refund claim. He further submits that the show cause notice also alleges the same. On merits, he submits that services availed by the appellant prior to the date of Notification No.41/2007-ST as amended and services have availed by the appellant prior to the date of insertion of notified services under notification and the export took place prior to the date of notification No.41/2007-ST. He also submits that the condition of the notification are required to be fulfilled as held by Honble High Court of Allahabad in the case of Addi Industries Ltd.-2014 46 GST 204/46 taxmann.com 223 (Allahabad). Therefore, he submits that the impugned order is required to be upheld.

6. Heard the parties and considered the submissions.

7. After hearing the parties, I find that I have to decide the following issues:

(i) Whether the Order-in-Appeal No.222/ST/DLH/2011 passed by the Commissioner (Appeals) on 2.9.2011 has attained finality or not.

(ii) Whether the adjudicating authority is having the right to re-examine the refund claim on new ground after the Order-in-Appeal dated 2.9.2011 or not.

(iii) Whether the appellant is entitled for refund claim of the services availed prior to amendment in the notified services in the Notification No.41/2007-ST or not.

8. In this case, the main contention of the ld.AR is that the order dated 2.9.2011 passed by the Commissioner (Appeals) has open order for re-examination by the adjudication authority with certain directions to verify certain documents. Therefore, the adjudicating authority is having every right to examine the refund claim afresh. This argument is not acceptable when the Committee of Commissioners has accepted the Order-in-Appeal dated 2.9.2011. However, on examination of the said order, I find that the Commissioner (Appeals) has directed to verify certain documents. In that case, if those documents were not produced by the appellant or found deficient then the refund claim can be rejected to that extent. But the refund claim cannot be examined afresh.

9. In this case, I find that the adjudicating authority has taken the new ground to adjudicate the refund at the time of verification of certain documents which is also not permissible in law. As the show cause notice was issued to the appellant in the matter has already attained finality by the order of the Commissioner (Appeals) on 02.09.2011. If at all, the adjudicating authority wanted to re-examine all the refund claims, the adjudicating authority is required to be issue fresh show cause notice which the adjudicating authority has failed to do so. In the circumstances, the order dated 02.09.2011 has attained finality as held by the Apex Court in the case of ITC Ltd., Revenue has not preferred any appeal against that order. In the circumstances, the adjudicating authority has no right to re-examine the refund claim but only can verify the documents as directed by the Commissioner (Appeals).

10. On merits also I have considered the issue. In the Notification No.41/2007, there is no condition that if the services availed prior to the date of notification, the appellant are not entitled to refund claim as held by the Honble Bombay Court in the case of WNS Global Service Pvt.Ltd. (supra).Relying on the judgement of Honble Allahabad High Court in the case Addi Industries Ltd., the contention of the ld.AR that the conditions of the notification are required to be fulfilled by the appellant, I find that in the case of Addi Industries Ltd.(supra), the condition of the notification was that refund claim is to be filed within the prescribed time but there is no condition in the notification that if the services availed prior to insertion of services as notified services in the notification No.41/2007, refund is not admissible. Therefore reliance on the case of Addi Industries (supra) is not acceptable as the facts of that case are different to the present case.

11. In the circumstances, I set aside the impugned order and direct the adjudicating authority to sanction the refund claim on verification of the documents as directed by the Commissioner (Appeals) vide his order dated 02.09.2011 within the period 90 days of the receipt of this order.

(pronounced in the open court)

(Ashok Jindal)

Member (Judicial)

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