Time Limit would not be Applicable on Refund claim of amount wrongly paid as Service Tax

In the case of JYOTSANA D. PATEL Vs. Com­mis­sion­er of Cen­tral Excise, Nag­pur 2014 (35) S.T.R 77 (Tri. Mum­bai), the Hon’ble CESTAT of Mum­bai held that pro­vi­sions of Sec­tion 11B of Cen­tral Excise Act, 1944 i.e. bar of lim­i­ta­tion are not applic­a­ble on the refund claim of amount wrong­ly paid as ser­vice tax or any oth­er such amount which is not required to be paid under decree of law.

In the instant case, appel­lant acquired a Res­i­den­tial Unit from a builder who col­lect­ed ser­vice tax from the assessee. Since, ser­vice tax is not levi­able on the res­i­den­tial unit as held by Hon’ble High Court in case of K.V.R Con­struc­tions Vs. CCE-2010TIOL-68-HC-KAR-ST= 2010(17) S.T.R 6 (Kar.), appel­lant filed a refund claim of the amount paid by builder as ser­vice tax to the depart­ment. The adju­di­cat­ing author­i­ty sanc­tioned the refund claim. How­ev­er, on the appeal filed by rev­enue before the Com­mis­sion­er (Appeal), refund claim reject­ed on the ground of limitation.

There­after, the Hon’ble CESTAT held that as the appel­lant was not required to pay ser­vice tax on acqui­si­tion of Res­i­den­tial Unit and the amount so col­lect­ed is not an amount of ser­vice tax. There­by, the pro­vi­sions of Sec­tion 11B of Cen­tral Excise Act, 1944 are not applic­a­ble in the instant case. Hence, the appeal is allowed in the favour of assessee.

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