Custom, Excise & Service Tax Tribunal
C.C.E. Bhopal vs M/S. Essarjee Construction Pvt. Ltd on 7 November, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. III
Service Tax Appeal No. ST/168/2012-ST[DB]
[Arising out of Order-In-Appeal No. 223/BPL/2011 dated 12.12.2011 passed by Commissioner(Appeals) Bhopal]
For approval and signature:
Hon'ble Mr. S.K. Mohanty, Member (Judicial)
Honble Mr. B. Ravichandran, Member (Technical)
1
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3
Whether Their Lordships wish to see the fair copy of the Order?
4
Whether Order is to be circulated to the Departmental authorities?
C.C.E. Bhopal ...Appellant
Vs.
M/s. Essarjee Construction Pvt. Ltd. Respondent
Appearance:
Mr. Sanjay Jain, DR for the Appellant None appeared for the Respondent CORAM:
Hon'ble Mr. S.K. Mohanty, Member (Judicial) Honble Mr. B. Ravichandran, Member (Technical) Date of Hearing/ Decision.07.11.2016 Final Order No. 54924 /2016 Per S. K. Mohanty:
This appeal is directed against the impugned order dated 12.12.2011 passed by the Commissioner (Appeals), Customs and Central Excise, Bhopal. The grievance of Revenue is that the unjust enrichment aspect has not been properly dealt with by the Ld. Commissioner (Appeals) in the impugned order.
2. None appeared for the respondent. Heard Sh. Sanjay Jain, Ld. DR for the Revenue.
3. The Ld. Commissioner (Appeals) has discussed the unjust enrichment aspect in great detail in the impugned order, which are extracted herein below:
6. I have carefully gone through the case records available before me as well as rival submissions made by both the parties. The allegation made by the appellant is that authority while sanctioning the claim has not given consideration to clause of unjust enrichment which has been countered by respondent on a number of footings mentioning the refund being consequential in nature. Though the department has made the allegation to ascertain the facts I have called for the divisional file. On going the divisional claim file I find that the respondent has filed a certificate with the authority in the form of Rs. 10/- Indian non judicial stamp certifying that (1) We have certified that we have paid service tax amount to the Central Government from our own fund we have not collected the service tax for which refund claim has been filed from my customer/consumer. (2) It is certified from my balance sheet that we have paid the service tax after my gross profit supporting the fact that the service tax has been paid by us from our own funds. Not only this as stated in the certificate on non judicial stamp, copy of balance sheet is also available there in the record. A perusal of balance sheet and its annexures specifically the consolidated contract and Profit and Loss Account reveals that the respondent have paid the service tax after arriving at gross profit, which leaves no doubt to suspect the claim of the respondent that whatever refund claim is made and sanctioned has been paid by the respondent from their own pocket without disbursing/ collecting it from their customers. According to normal accounting principle, any expenditure charged to Profit & Loss Account reduces the profit of a concern. The expenditure being charged to Profit and loss account gives light to the non passing of the incidence of duty to the ultimate consumer.
The respondent in addition to above evidences has also come before me with a Chartered Accountant Certificate, certifying the respondent did not collect duty from their customers. The said certification read as under:-
TO WHOM SO EVER IT MAY CONCERN This is to certify that on the basis of books of accounts and records produced before us, M/s Essarjee Construction Pvt. Ltd, Bhopal has paid the Service Tax for sum of Rs. 28,34,961/- during the period from May 2008 to January 2009 towards construction of residential complex.
This is further certified that M/s Essarjee Construction Pvt. Ltd, Bhopal has not passed the burden of Service Tax to any customer and also they have not collect any service tax form the customers for the relevant period and they have borne the burden of Service Tax from their own resources.
Bhopal For A.K Chanderia & Co.
Chartered Accountants Dated 29/11/2011 CA Anil Kumar Jain Partner M. No. 078197 It can be noticed from the above reproduced certificate that the CA before issuing the certificates had verified the entire books of accounts and has come to a categorical conclusion that respondent has not passed on the burden of Service tax to the customers nor they have recovered the same from the customers. The certificate also categorically states that the respondents had borne the incidence of service tax.
Thus when the tax paid is deducted from their profit well supported by CA certificate. The claim does not appear to have been hit by clause of unjust enrichment as provided under Section 11B of the Central Excise Act, 1944.
4. On going through the impugned order, we find that refund claim was sanctioned by the Ld. Commissioner (Appeals) not only based on the certificate issued by the Chartered Accountant but also on verification of books of accounts namely profit and loss account, balance sheet and the agreements entered into between the Respondents and the buyers. Hence, we are of the view that the doctrine of unjust enrichment will have no application and the respondent should be eligible for the refund claim. Therefore, we do not find any infirmity in the impugned order and dismiss the appeal filed by Revenue.
(Dictated and pronounced in the open court)
(B. Ravichandran) (S. K. Mohanty)
Member(Technical) Member (Judicial)
Neha
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