Order Date – 05 July 2023

Parties: M/s. Rajendra Mittal Construction Company Pvt. Ltd. Vs Commissioner of CGST, Alwar (Raj.)

Facts – 

• The Appellant, M/s. Rajendra Mittal Construction Company Pvt. Ltd., during an audit conducted by the department, was found to be provided work contract services without paying any service tax. On demand the appellant deposited part amount of his service tax liability with interest on 09.08.2015.
• Though the said liabilities were initially confirmed by the Original Adjudicating Authority. However, the appeals against the said order were allowed by Commissioner (Appeals) vide order dated 18.01.2021. The appellant filed a refund of pre-deposit along with interest on 22.01.2021.
• The Department, however, observed that the aforesaid amount of refund the amount of with interest was deposited after being pointed out by the Audit. Also, the claim is barred by time. Accordingly, the refund claim was rejected.

Issue – 

• Whether the appellant is entitled to refund of pre-deposit amount?

Order –

• The Tribunal observed that the amount in question along with interest was deposited by the appellant on 09.08.2015, at the stage of investigation itself towards the partial discharge of the liability pointed out by the audit team. Hon’ble Apex Court in Mafatlal Industries vs. Union of India reported as 1997 (89) ELT 247 (S.C.) (para 83) has held that the amount paid pending investigation is nothing but the amount paid under protest.
• In the present case the refund claim was filed pursuant to the order passed by the Commissioner (Appeals) dated 18.01.2021. The claim was filed on 25.01.2021 i.e. within less than a week of the aforesaid order. It is not the case of Department that said order was ever appealed against by the Department. Seen from this perspective the refund is otherwise well within the reasonable period.
• Department is held liable to refund the said amount also alongwith the interest. Relying upon the decision of this Tribunal in the case of Parle Agro Pvt. Ltd. and Dugger Fibers Pvt Ltd. the Department is directed to grant interest on the said amount at the rate of 12% from the date of deposit till the date of payment.

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