Customs, Excise and Gold Tribunal - Mumbai
Karnik Maritime Pvt. Ltd. vs Commissioner Of Central Excise on 31 January, 2006
Equivalent citations: [2007]8STJ442(CESTAT-MUMBAI), 2007[6]S.T.R.314, [2007]9STT80
ORDER T. Anjaneyulu, Member (J)
1. Heard both sides.
2. The assessee is in appeal aggrieved by the order passed by Commissioner (A), who in turn upheld the Order-in-Original. Both the authorities below held that the refund claim filed by the appellants was time barred.
3. The appellants, who was carrying out the business rendering "Pilotage Services" at minor ports by describing this as "Management Consultant Services" was praying Service Tax, but actually the appellants unit was brought into Network of Service Tax from 01.07.2003, Therefore, the appellants' claim for refund for amount paid on 09.10.2003. The Department has given the refund for one year from 01.10.2002 to 31.05.2003 But their application was rejected by the department on the ground of limitation of time.
4. The ld. Counsel for the appellants relied upon the case law of Heaxacom (I) Ltd. v. CCE, Jaipur Therefore, whatever payment was made did not relate to Service Tax at all It was merely an erroneous collection by DOT and payment by the Appellants. Therefore, provisions relating to refund of Service Tax including those relaxing to unjust enrichment can not have any provisions contained in Section 11D of the Central Excise Act have not been made applicable to Service Tax. Therefore, if any amounts are collected erroneously as representing Service Tax, which is not in force, there is no bar to the return of such amounts. The rejection of refund application was therefore, not correct.
But the Commissioner (A) has observed the said decision is not applicable. Further, the ld. DR. relies upon the case law of Chennai Telephone (BSNL) v. CCE, Chennai 2004 (169) ELT 222 (Tri.Chennai), similar view was taken by the Chennai Tribunal as in Heaxacom (I) Ltd.
5. Further, the ld. Counsel for the appellants have relied upon the ruse law of Indo-Nippon Chemicals Co. Ltd. v. UOI 2005 Z STJ 1025 (Guj.), it is held that the assessee had to reverse the claim of Modvat credit at the instance of the local Excise Authorities in the months of Feb./ March, 1995. A public Notice No. 6/1995 dated 09.01.1995 allowing such credit came to the knowledge of the Petitioner in November 1995 and then it lodged a claim for refund. The Asstt. Commissioner has rejected the claim invoking the provisions of Section 11B stat that the claim was lodged beyond the period of six months (the period is extended to one year w.e.f. 12.05.2000). Being aggrieved, the Petitioner filed a Writ Petition in the Gujarat High Court. The Hon'ble High Court held that, it was a case of mutual mistake committed by both, the Petitioner and the Department, therefore Section 17 of the limitation of Act should be applicable. Section 17 provides that where in a suit or application is based upon a mistake, the period of limitation would not begin to run until the plaintiff or the applicant has discovered the mistake or could have, with reasonable, diligence discovered it. On the question of limitation, finally the High Court concluded that "since the claim was based on discovery of mistake, the period of limitation would not commence from the date of reversal of Modvat Credit, but from the date when the mistake committed mutually of wrong reversal of credit by the parties was discovered in Nov. 1995. The refund claim, therefore, was to be held to be within time."
6. In light of aforesaid decision, it is quite felt expedient to remand the matter back to the Commissioner (A) for fresh disposal after considering the above principles. Accordingly, the appeal is allowed in remand in above terms.
(Pronounced in court)