Service Tax
TRT-2025-
Cestat Kolkata
Date:-14-03-23
In:-
Issue Favourable to Tax Payer ?:-
M/s. Oil India Limited Vs Commissioner of Central Excise & Service Tax Dibrugarh
Order Date – 14 March 2023
Facts –
- The Appellant, M/s. Oil India Limited, is engaged in the exploration and production of Crude Oil and Natural Gas. The Appellant entered into arrangements with two foreign entities (NOMC and Haliburton), incorporated abroad for the receipt of certain services. They filed refund claim for the amount paid on the aforesaid transaction.
- A show cause notice dated 12.04.2017 was issued proposing to reject its claim alleging that the appellant failed the bar of unjust enrichment. It was also alleged that there was no evidence of double payment and in any event the refund claim filed was time barred.
Issue –
- Whether the appellant is entitled to refund?
Order –
- The Tribunal observed that NOMC and Haliburton setup establishments in Jodhpur and Bombay respectively, obtained Service Tax registrations and discharged Service Tax. Reliance is placed on the decision of the Tribunal in the case of Nagarjuna Oil Corporation Ltd. vs. CCE Puducherry [2017 (47) S.T.R. 96 (Tri. Chennai)] wherein it was held that when branch offices of foreign service providers obtained registration and discharged Service Tax in India on the transaction in question, the service recipient located in India (the assessee in that case) was not required to discharge the same on reverse charge.
- Hence the Appellant was not required to discharge Service Tax on reverse charge on the said transaction and it did so under a mistake of law. It was held in many judgments that amounts paid under mistaken notions would not be hit by the statutory limitation period.
- It is also clear that the amounts have not been expensed out as the appellant is awaiting the outcome of the litigation. Hence the amount of Service Tax paid cannot be said to have been passed on to anyone. It was also found that Service Tax paid by the Appellant never formed part of the crude oil sold by the Appellant.
- Hence the appeal is allowed and the appellant shall be entitled to refund amount along with interest.
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