In the instant case, Jyotsana D. Patel (the Appellant) purchased a residential unit from a builder, on which the builder had collected Service tax and deposited the same with the Department. As there is no levy of Service tax on residential unit as held by the Hon’ble High Court in the case of K.V.R. Constructions Vs. CCE [(2010) 25 STT 436 (Kar.)], the Appellant filed a refund claim of the amount paid by the builder as Service tax to the Department. The refund claim filed by the Appellant was sanctioned by the Adjudicating Authority.
Thereafter, on appeal being filed by the Revenue before the Commissioner (Appeals), the Commissioner (Appeals) held that the refund claim is barred by limitation. Being aggrieved, the Appellant filed an appeal before the Hon’ble CESTAT, Mumbai.
The Hon’ble CESTAT, Mumbai held that when the Appellant was not required to pay any Service tax for acquisition of residential unit, amount deposited would not be considered as an amount of Service
tax and therefore, time limit prescribed under Section 11B of the Central Excise Act, 1944 will not be applicable. Accordingly, Order of the Commissioner (Appeals) was set aside and the matter was decided in favour of the Appellant.