R R Kabel Ltd Vs Commissioner of C.E. & S.T. (CESTAT Ahmedabad)
The appeals were filed against an order of the Commissioner (Appeals) which upheld the rejection of refund claims filed by the appellant. The dispute arose from payment of service tax under the reverse charge mechanism on services such as Goods Transport Agency (GTA), Manpower Recruitment Agency Service, and Renting of Immovable Property Service.
During a CERA audit, it was observed that the appellant had not paid service tax on the above services under the reverse charge mechanism. Upon being pointed out, the appellant paid the service tax and subsequently filed three refund claims. The basis for the refund claims was that, due to the introduction of the GST regime with effect from 01.07.2017 and the lapse of the provisions governing Cenvat credit, the appellant was unable to avail credit of the service tax paid.
The Revenue issued three show cause notices proposing rejection of the refund claims on the ground that there was no provision for refund of such service tax under either the earlier regime or the GST regime. The Assistant Commissioner rejected the refund claims through orders dated 21.01.2019. Appeals filed before the Commissioner (Appeals) were also rejected by order dated 22.04.2019, holding that refund was not permissible under existing law and that the GST law did not allow transition of such tax payments into input tax credit.
