Case Law Details
Abhinav Pratap Raju And 24 Others Vs Indira Gandhi Rashtriya Uran Akademi (Allahabad High Court)
Allahabad High Court has directed the Indira Gandhi Rashtriya Uran Akademi (IGRUA) to address the refund claims of service tax made by a group of aviation students, including the petitioners, who had enrolled at the academy after 2010. The petitioners had paid service tax as part of their course fees, which was later found to be wrongly levied. This decision follows a precedent where the Delhi High Court, in 2013, ruled that service tax on aircraft training institutes, including IGRUA, was contrary to the Finance Act, 1994, and a related notification. Consequently, the Custom Excise and Service Tax Appellate Tribunal (CESTAT) and the Supreme Court upheld this position.
The petitioners, who were students at the time, argued that since the service tax was not applicable, they were entitled to a refund. The academy had initially filed for a refund but contended that the service tax was paid out of its own pocket and not passed on to the students. However, the academy’s communication with the students indicated that the fee burden, including the service tax, was indeed passed on to the students. The court, recognizing these facts, has instructed the academy to process the refund claims expeditiously. The petitioners have been given the liberty to submit fresh refund applications, either physically or electronically, which the academy must address within two months, following the precedent set by the Delhi High Court.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
1. Heard Mr. Vipul Shukla, learned counsel for petitioners and Mr. Yogesh Chandra Bhatt, learned counsel for opposite party.
2. Petition has been filed seeking a direction to the sole opposite party to refund the sum of Service Tax to petitioners alongwith interest.
3. Learned counsel for petitioner submits that petitioners had obtained admission in the Indira Gandhi Rashtriya Uran Akademi, Furshatganj, Amethi subsequent to 2010. For the aforesaid time period, Service Tax was levied upon opposite party. It is submitted that such Service Tax was levied upon all such Aircraft Training Institutes across the country and one such institute namely the Indian institute of Aircraft Engineering thereafter filed Writ Petition (C) No. 3513 of 2012 before the High Court at Delhi which was allowed by means of judgment and order dated 21.05.2013 in which it was held that making such institute accessible to Service Tax is contrary to Section 65 (27) of the Finance Act, 1994 as well as the notification dated 25.04.2011. It is submitted that in pursuance of such a direction issued by the Delhi High Court, the Custom Excise and Service Tax Appellate Tribunal, New Delhi passed the order dated 02.07.2013 deciding a number of appeals in the light of aforesaid judgment rendered by the Delhi High Court. It is submitted that Appeal No. 58 of 2012 preferred by the opposite party against imposing of such Service Tax was also allowed in terms of judgment rendered by the Delhi High Court as indicated in the order dated 02.07.2013 itself.
4. It is submitted that the aforesaid judgment was thereafter challenged by the Commissioner Central Excise, Lucknow before this Court in Central Excise Appeal No. 4 of 2014, particularly pertaining to opposite party. The said appeal was dismissed vide judgment and order dated 20.01.2014 and special leave to appeal bearing Diary No. 13548 of 2014 against such a judgement was also dismissed vide order dated 06.02.2018 by Supreme Court.
5. It is, therefore, submitted that once it has already been conclusively established that such institutes as the opposite party were not required to submit Service Tax, petitioners being students from whom such Service Tax was realized as a part of their fee, are entitled for a refund thereof.
6. Learned counsel has, however, also adverted to the application submitted by opposite party for refund of Service Tax to the Assistant Commissioner Raebareli dated 24.06.2014, particularly paragraph 13 thereof to submit that the claim for refund has been made by the institute but stating that the aforesaid tax has been erroneously paid out of their own pocket without burden to tax having been passed on to the students.
7. He has, however, thereafter adverted to various letters issued by the instituted to various students, some of whom are petitioners in the present writ petitions to submit that the institute has deferred the application of such students for refund only on the ground that such an amount can be refunded only after the same is receipt from the department, thereby impliedly admitting that such a tax was in fact realized from the students.
8. Learned counsel has, however, also submitted that the opposite party has filed Central Excise Appeal (CEXA) 29 of 2019 and 58 of 2019, which are still pending consideration.
9. Learned counsel for opposite party submits that in case representations are made by petitioners with regard to such refund of fee, the same would be decided by the appropriate authority in the light of facts indicated hereinabove.
10. In view of innocuous prayer being made, liberty is granted to petitioners to file a fresh individual application/representation either physically or through e-mail for refund of such Service Tax, which shall be considered and decided by the opposite party expeditiously, preferably within a period of two months from the date of presentation of such representation alongwith copy of this order, particularly adverting to the facts whether such a tax was realized from petitioners as a part of their fee and in terms of the judgment rendered by Delhi High Court.
11. With the aforesaid directions, petition stands disposed of.
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