Custom, Excise & Service Tax Tribunal
Jmc Projects Ltd vs Service Tax - Ahmedabad on 11 October, 2018
In The Customs, Excise & Service Tax Appellate Tribunal
West Zonal Bench At Ahmedabad
Appeal No.ST/262/2010-DB
[Arising out of OIA-89/2010/STC/HKJ/COMMR-A-/AHD Dated 10.03.2010 passed by
Commissioner of Service Tax-SERVICE TAX - AHMEDABAD]
M/s Jmc Projects Ltd Appellant
Vs
C.S.T. & Service Tax- Ahmedabad Respondent
Represented by:
For Appellant: Shri Jigar shah & Ms. Priyanka Kalwani (Advocate) For Respondent: Shri K. J. Kinariwala (AR) CORAM:
HON'BLE MR. RAMESH NAIR, MEMBER (JUDICIAL) HON'BLE MR. RAJU, MEMBER (TECHNICAL) Date of Hearing: 11.09.2018 Date of Decision: 11.10.2018 Final Order No. A/ 12144 /2018 Per: Ramesh Nair The facts of the case, in brief, are that the appellant are registered under the category of Consulting Engineer, Commissioning & Installation, Commercial Construction, goods transport by road service. The appellant submitted a refund claim for an amount of Rs. 14,26,933/- on 30.07.2008 on the ground that they had provided services to the developer of SEZ and the services were consumed in the SEZ itself, hence the services provided by them were not liable to service tax. They had paid service tax erroneously which deserves to be refunded. The adjudicating authority rejected the refund claim on the ground of merit as well as unjust enrichment. The adjudicating authority contended that the approval of Co-developer agreement was issued on 28.01.2008 whereas the services provided during period August 2007 to
2|Page ST/262/2010-DB December 2007. During the said period there was no approval, therefore, there was no exemption for payment of service tax. On the issue of unjust enrichment, the adjudicating authority contended that since the appellant shown the service tax over and above contract price in the invoice, therefore, plea raised by the appellant that the burden had not been passed on to service recipient is not substantiated. The Ld. Commissioner (Appeals) in the appeal filed by the appellant upheld the rejection of refund claim, however, no findings was given on the issue of unjust enrichment.
2. Sh. Jigar Shah Ld. Counsel with Ms. Priyanka Kalwani appeared for the appellant. He submits that though at the time of providing services i.e. August 2007 to December 2007. Co-developer approval was not available but the same was issued on 28.01.2008 wherein the Co- developer agreement dated 27.01.2007 formed part of this approval. Therefore, the approval stand validated from the date of agreement i.e. 27.01.2007, on this ground refund should not have been rejected. As regard the issue of unjust enrichment, he submits that there is certificate from service recipient that though the service tax charged in the bills but the payment of the same was not given. He also submits that as per the CA Certificated, ledger, the service tax amount charged in the bill was not received by the appellant and the same was shown as receivable in their books of account, therefore, the burden of said service tax was not passed on to any other person. In support of his submission, he placed reliance on the following judgment:
Zydus Mayne Oncology Pvt. Ltd Vs. CCE 2010 (262) ELT 280 (T) Reliance Industries Ltd Vs. CCE 2014 (311) ELT 401 (T) CCE Vs. Modest Infrastructure Ltd 2011 (24) STR 369 (T) CCE Vs. Modest Infrastructure Ltd 2013 (31) STR 650 (Guj.)
3|Page ST/262/2010-DB Shri Nutan Shah Vs. CCE 2015-TIOL-1541-CESTAT-AHM Reliance Industries Ltd Vs. CCE 2016 (41) STR 465 (T)
3. Sh. K.J. Kinariwala Ld. Assistant Commissioner (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order.
4. We have carefully considered the submission made by both the sides and perused the records. We find that the only reason for rejection of refund claim by the lower authority is that at the time of rendering the service by the appellant, the Co-developer had no approval as a Co-
developer of SEZ, therefore, the exemption of payment of service tax was not available at the relevant time. We have per used the approval of Co-developer of M/s RGA Software Systems Pvt. Ltd. The same is scanned below:
4|Page ST/262/2010-DB
5|Page ST/262/2010-DB
6|Page ST/262/2010-DB
5. From the above approval issued on 28.01.2008, but in para 2, the Co-developer agreement dated 27.01.2007 was formed part of the same approval dated 28.01.2008, therefore, the approval become effective retrospectively i.e. from 27.01.2007. In this fact, the services provided during August 2007 to December 2007 is clearly to Co-developer M/s
7|Page ST/262/2010-DB RGA Software Systems Pvt. Ltd, this to be approved as Co-developer of SEZ by Ministry of Commerce and Industries. Accordingly, the services provided to approve Co-developer of SEZ was exempted from payment of service tax, hence the service tax paid by the appellant is refundable.
As regard unjust enrichment, we find that the appellant have admittedly not recovered the amount of service tax from the service recipient, which is evident from the certificate issued by the service recipient of M/s RGA Software Systems Pvt. Ltd.
6. It is also observed that the CA on the basis of books of account of the appellant certified that amount of service tax was not recovered from the service recipient. The Ld. Counsel also invited our attention to the ledger which shows that the amount of service tax was not recovered by the appellant from M/s RGA Software Systems Pvt. Ltd. On query from the Bench, Ld. Counsel stated that the said amount was shown as receivable in the balance sheet, however, the balance sheet was not produced. Therefore, the adjudicating authority before sanction of the refund claim must verify the balance sheet that whether the amount of refund is shown as receivable on the asset side in the balance sheet, if it is found as receivable, the refund cannot be hit by unjust enrichment. As per our above discussion the appeal is allowed in above terms.
(Pronounced in the open court on 11.10.2018)
(Raju) (Ramesh Nair)
Member (Technical) Member (Judicial)
Seema