Case Law Details
RJB Estate Pvt. Ltd. Vs Commissioner of Central Tax (CESTAT Mumbai)
Introduction: In the case of RJB Estate Pvt. Ltd. vs. Commissioner of Central Tax (CESTAT Mumbai), a dispute arose regarding the refund claim of service tax. This article provides an in-depth analysis of the case, including the background, reasons for the refund claim, and the decision reached by CESTAT Mumbai.
Background of the Case: On March 25, 2019, RJB Estate Pvt. Ltd. submitted a claim for the refund of service tax amounting to Rs. 17,98,429/-. The company had previously entered into a Memorandum of Understanding with M/s. Amar Builders on September 25, 2012, and had paid an approximate sum of Rs. 6 crores to M/s. Amar Builders. Subsequently, RJB Estate Pvt. Ltd. canceled the deed with M/s. Amar Builders on June 25, 2019, and sought a refund of the deposit paid to them. The company claimed that M/s. Amar Builders had deducted Rs. 17,98,429/- as service tax and refunded the remaining balance to RJB Estate Pvt. Ltd.
Refund Claim Rejection: RJB Estate Pvt. Ltd. filed the claim for the service tax refund on March 25, 2019, with the Assistant Commissioner, Pune-II CGST Commissionerate. However, the original authority rejected the claim, citing the provisions of Section 11B of the Central Excise Act, 1944. They argued that the claim was filed after the expiration of one year from the relevant date, which, in this case, was the date of payment of tax. Dissatisfied with this decision, RJB Estate Pvt. Ltd. appealed to the Commissioner (Appeals), whose decision is the subject of this case.
Commissioner (Appeals) Decision: The Commissioner (Appeals) upheld the original authority’s decision to reject the refund claim. It was argued that Section 11B of the Central Excise Act, 1944, was applicable to service tax matters, and this section specified that a refund claim should be filed within one year from the relevant date. In this case, the relevant date was considered to be the date of payment of service tax. Since RJB Estate Pvt. Ltd. had made the payment of Rs. 6 crores within the calendar year 2012, the refund claim filed on March 25, 2019, was unquestionably beyond the one-year limitation from the date of payment of tax.
CESTAT Mumbai’s Decision: The CESTAT Mumbai carefully reviewed the case records and the arguments presented. They observed that both the original authority and the appellate authority had correctly interpreted Section 11B of the Central Excise Act, 1944. Additionally, the CESTAT noted that the Commissioner (Appeals) had referred to a ruling by the Hon’ble Supreme Court in the case of Collector of Central Excise, Chandigarh vs. Doaba Co-operative Sugar Mills, where it was held that the limitations provided under the Customs Act and Central Excise Act are applicable to refund claims made before departmental authorities. In the context of Section 11B, the relevant date for the refund claim was determined as the date of payment of service tax. Since RJB Estate Pvt. Ltd. had not filed the refund claim within one year from this date, the CESTAT upheld the impugned order and rejected the appeal.
Conclusion: The case of RJB Estate Pvt. Ltd. serves as a reminder of the importance of adhering to statutory limitations when filing refund claims for service tax. The decision by CESTAT Mumbai underscores the significance of the relevant date in determining the validity of such claims, in accordance with the provisions of Section 11B of the Central Excise Act, 1944.
FULL TEXT OF THE CESTAT MUMBAI ORDER
Brief facts of the case are that on 25.03.2019, appellant submitted a claim for refund of service tax of Rs.17,98,429/-. Appellant had entered into a Memorandum of Understanding with M/s. Amar Builders on 25.09.2012 and paid amount of around Rs.6 crores to M/s. Amar Builders. Appellant cancelled the deed with the said M/s. Amar Builders on 25.6.2019 and sought for refund of deposit paid to M/s. Amar Builders. Appellant claims that M/s. Amar Builders deducted Rs.17,98,429/- on account of service tax paid and refunded the balance to the appellant. On 25.03.2019, appellant claimed the said amount of service tax towards refund by filing the claim of refund with the Assistant Commissioner, Pune-II CGST Commissionerate. The original authority rejected the claim under the provisions of Section 11B of Central Excise Act, 1944 stating that the claim was filed after expiry of one year from the relevant date, i.e. date of payment of tax. Aggrieved by the said order, appellant preferred appeal before Commissioner (Appeals). The said appeal was decided through the impugned order-in-appeal. Learned Commissioner (Appeals) upheld the order of the original authority rejecting the refund claim. Aggrieved by the said order, appellant is before this Tribunal.
2. Heard the learned Chartered Accountant on behalf of the appellant. Learned Chartered Accountant has submitted that in the present case, relevant date should be treated as 25.03.2019 which is the date of termination of Memorandum of Understanding and not the date of payment of tax.
3. Heard the learned AR for Revenue who has stated that Section 11B of Central Excise Act, 1944 is made applicable to service tax matters and limitations are specified in said Section 11B that the claim for refund should be filed within one year from the relevant date and in the instant case, relevant date is date of payment of tax. He has submitted that the appellant had made payment of Rs.6 crores within the calendar year 2012 and, therefore, refund claim filed on 25.03.2019 is definitely beyond one year from the date of payment of tax and, therefore, the impugned order is tenable in law.
4. I have carefully gone through the record of the case and submissions made. I note that the original authority and appellate authority have held that the refund claim was filed beyond the limitation prescribed by Section 11B of Central Excise Act, 1944. I have perused the impugned order-in-appeal and I note that learned Commissioner (Appeals) has followed the ruling by Hon’ble Supreme Court in the case of Collector of Central Excise, Chandigarh vs. Doaba Co-operative Sugar Mills reported at 1988 (37) ELT 478 (SC). Learned Commissioner (Appeals) has reproduced the headnotes in his order which clearly indicate that Hon’ble Supreme Court has held that for the refund claims made before the departmental authorities, limitations provided under Customs Act and Central Excise Act are applicable. Under the provisions of Section 11B of Central Excise Act, 1944, the refund claim has to be filed within one year from the relevant date and in the present case, relevant date is date of payment of service tax. It is clear from the record that the present refund claim was not filed within one year from the date of payment of service tax. I, therefore, do not find any infirmity in the impugned order.
5. I, therefore, uphold the impugned order and reject the appeal.
(Order pronounced in the open court on 11.09.2023)
