Custom, Excise & Service Tax Tribunal
M/S. I Process Services India (P) Ltd vs C.C.E. & S.T. Delhi on 25 August, 2015
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI PRINCIPAL BENCH, COURT NO. II Appeal No. ST/53000/2014-ST(SM) [Arising out of Order-in-Appeal No. 33/ST/DLH/2014 dated 21.02.2014 by the Commissioner of Customs, Central Excise & Service Tax (Appeals), New Delhi]. For approval and signature: Honble Shri Ashok Jindal, Member (Judicial) 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? M/s. I Process Services India (P) Ltd. .Appellants Vs. C.C.E. & S.T. Delhi .Respondent
Appearance:
Shri Bimal Jain, Advocate for the Appellant Shri M.S. Negi, DR for the Respondent CORAM:
Hon'ble Shri Ashok Jindal, Member (Judicial) Date of Hearing: 25.08.2015 FINAL ORDER NO. 52717/2015-ST(SM) Per Ashok Jindal:
The appellant is in appeal against the impugned order rejecting their claim of interest on delayed refund.
2. The facts of the case are that appellant received advances from ICICI bank for providing certain services to the tune of Rs.14,73,86,000/- of which the appellant paid Service tax to the tune of Rs.1,56,83,969/- in cash and Rs.5,28,686/- through Cenvat Credit Account. Later on, on 23.03.2009 the service recipient i.e. ICICI Bank confirmed to the appellant that they no more require their services against advance paid to them. On termination of their contract for services on 24.03.2009 the appellant filed the refund claim of service tax paid by them on the advances received from the service recipient on 31.07.2009. On 22.10.2009 the deficiency memo was issued to the appellant asking certain queries which were replied by the appellant on 30.11.2009. Thereafter, personal hearing was granted to the appellant and finally on 30.06.2011 the refund claim was rejected on the premises that:
a) Refund claim is barred by limitation
b) The appellant has not refunded the whole of the total advances received by them and have retained a sum of Rs.4,24,78,264/-, and;
c) The refund claim was hit by bar of unjust enrichment.
3. The appellant challenged the said order before the Ld. Commissioner (A) on 22.09.2011. The Ld. Commissioner (A) vide order dated 05.12.2012 allowed the refund claim holding that the ground on which refund claim was rejected by the Adjudicating Authority is not tenable. Thereafter, the appellant has approached the department for releasing the refund and various reminders were given. On 02.09.2013 a personal hearing was granted to the appellant and thereafter on 28.10.2013 refund claim was sanctioned. The appellant claim is that they have not received the refund claim along with interest. Therefore, appellant filed an appeal before the Ld. Commissioner (A) for granting interest on delayed refund. The Ld. Commissioner (A) vide order dated 21.02.2014 rejected the claim of interest on the ground that refund was allowed within three months from the date of submission of documents by the appellant. Aggrieved from the said orders appellant is before me.
4. The Ld. Consultant appearing on behalf of the appellant submits that in this case the appellant has filed refund claim on 31.07.2009 and after three months of the said date the appellant is entitled to claim interest on delayed refund as held by the Honble Apex Court in the case of Ranbaxy Laboratories Ltd. Vs. UOI-2011 (273) ELT 3 (SC). He further submits that the appellant has filed the refund claim on 31.07.2009 which was held to be barred by limitation and the Ld. Commissioner (A) has decided that the refund claim filed on 31.07.2009 is within time. Therefore, the date of refund claim is very much relevant to deciding the claim of interest of delayed refund by the appellant. He further submits that order of the Ld. Commissioner (A) holding that refund claim is filed within time has been accepted by committee of Commissioners. Therefore there is no dispute with the delay of claim of the refund. He also submits that the Department kept delaying refund claim on one premise or the other premise and sanctioned the refund claim only after filing several reminders to the Department on 28.10.2013. Therefore, they are entitled for claim of interest on the delayed refund.
5. On the other hand, Ld. AR oppose the intention of the Ld. Counsel and submits that although the appellant has filed refund claim on 31.07.2009 but they have not refunded whole of the advances received by them by ICICI bank on the said date. Therefore, issue of point of taxation is core issue on the case and matter is to be dealt by Division Bench of this Tribunal. He further submits that as appellant has returned whole of the amount of advances received by them only on 27.05.2011, therefore, they can claim the interest only after the said date or after three months of the date when he paid the advances received from ICICI bank.
6. Heard the parties. Considered the submission.
7. In this case the Ld. Commissioner (A) hold that the refund claim has been sanctioned within three months from the date of filing of the documents by the appellant. Therefore, refund is paid to the appellant within time and no interest is payable. I also find that it is an admitted position that appellant filed the refund claim on the entire amount on 31.07.2009. Initially, the refund claim was rejected on the ground that refund claim is not within time and hit by bar of unjust enrichment and appellant has not refunded the entire amount of advance received and after retaining the amount of Rs.4,24,78,264/- the said amount has been returned by the appellant only on 26.05.2011. The issue raised by the Ld. AR that firstly the point of taxation is to be decided in this matter. As it has been held by the authorities below that refund claim filed by the appellant is within time and same has been accepted by the Committee of Commissioners. Therefore, issue is point of taxation has already been decided and same is not subject matter before me. Therefore, contention of the Ld. AR that matter is to be transferred to the division bench is not acceptable. Now, I come to the issue whether appellant is entitled for interest for delayed refund. Now the factual matrix of the case it is an admitted position that while rejecting their refund claim by the Adjudicating Authority the appellant was retaining the amount of Rs.4,24,78,264/- with them and the table incorporated in the order-in-original showing the date of payment by the appellant to the service recipient of the advance received by them. As per the table, the appellant has returned the amount of Rs.6,11,41,066/- before filing the refund claim and a sum of Rs.4,37,66,670/- were returned on 28.09.2010 and a sum of Rs.4,24,78,264/- were returned on 26.05.2011. These facts are admitted by both the sides. It is admitted fact that refund claim was sanctioned to the appellant only on 28.10.2013. Therefore, relying on the decision of Ranbaxy Laboratories Ltd. (Supra) the appellant is entitled for claim of interest on delayed refund of Rs.6,11,41,066/- after three months from 31.07.2009 till 28.10.2013. For the amount of Rs.4,37,66,670/- the appellant is entitled for interest for the period 28.09.2010 to 28.10.2013. On the amount 4,24,78,264/- the appellant is entitled to claim of interest for the period 26.05.2011 to 28.10.2013.
8. With these terms, I hold that appellant is entitled to claim interest as discussed above. With these observation, appeal is disposed off.
(Dictated and pronounced in the open court)
(Ashok Jindal) Member (Judicial)
Bhanu
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