Order Date - 11 October 2023

Parties: Smt. Sheela Vimala Rani vs. Commissioner of Central Excise, Madurai

Facts -

• The Appellant, Smt. Sheela Vimala Rani, had entered into an agreement to purchase land and construct a flat within a proposed residential complex by a developer.
• The Department claimed that the residential complex was subject to Service Tax as it was an approved project and not intended for personal use. The appellant, who purchased the flat for personal use and paid the Service Tax, sought a refund based on  C.B.E.C. Circular No. 108/02/2009-S.T. dated 29.01.2009.
• A show cause notice was issued proposing to reject the refund claim being the same was time-barred.

Issue:

• Whether the appellant's claim for a refund of Service Tax is valid?

Order:

• The Tribunal observed that it would relate back to the original filing of the rebate applications, though in wrong format. Admittedly, the date of the original refund claim is within one year as stipulated under Section 11B ibid.
• Hence the time limitation for refund application under Section 11B in the case on hand is to be reckoned from the date of original filing of such application. Hence, the issue of time-bar does not arise in the case on hand and to this extent, therefore, the impugned order cannot sustain.
• Further the builder had only remitted the tax portion paid by the appellant to the Department, and as admitted by his certificate, as having included the tax portion in the consideration received. Hence, we hold that the appellant was very much within her right to have claimed the impugned refund and further that she was also entitled for the same.
• The tribunal found that the reasons for denying the refund were without any basis, and the denial by the adjudicating authority was unsustainable. As a result, the appeal was allowed, and the appellant was entitled to the refund.