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K.K.S.K. Leather Processors Pvt. Ltd. v/s Commissioner of Central Excise, Salem

    Appeal No.ST/424/2010 [Arising out of Order-in-Appeal No.47/2010-(SKM) (ST) dated 31.3.2010 passed by the Commissioner of Central Excise (Appeals), Salem]

    Decided On, 31 March 2011

    At, Customs Excise Service Tax Appellate Tribunal South Zonal Bench At Chennai

    By, THE HONOURABLE MS. JYOTI BALASUNDARAM
    By, VICE-PRESIDENT

    For the Appellants: T. Ramesh, Advocate. For the Respondent: C. Dhanasekaran, SDR.



Judgment Text

1. The assessees filed a claim for refund of Rs.1,64,861/- under the provisions of Notification No.41/2007-ST dt. 6.10.2007 as amended, on 19.3.2009 - the service tax was paid by the assessees on sales commission for exports effected under shipping bills dt. 15.7.2007 and 26.7.2007. The adjudicating authority rejected the claim both on the ground that the taxable service in respect of which the claim was allowed was inserted in Notification No.41/07 only w.e.f. 1.4.2008 and hence services provided for export of goods effected prior to 1.4.2008 would not qualify for refund, and also on the ground of time-bar. Before the Commissioner (Appeals), the assessees accepted that they were not eligible to claim refund under the above mentioned notification and only pleaded that they were entitled to refund in terms of Rule 5 of the CENVAT Credit Rules, 2004. The lower appellate authority whose order is under challenge in the present appeal rejected the claim on the ground that Notification

No.5/2006-CE dt. 14.3.06 as amended, issued under Rule 5 of the CENVAT Credit Rules, 2004, specifies that the refund claim should be filed on quarterly basis along with the relevant shipping bills before expiry of the period specified under Section 11B of the Central Excise Act; since the exports related to shipping bills dt. 15.7.2007 and 26.7.07, the claim for refund should have been filed after the quarterly ending September 2007 but the claim was filed only on 19.3.2009 which is well beyond the expiry of the time limit prescribed under Section 11B of the Central Excise Act, 1944. He, therefore, rejected the claim on the ground of time-bar; hence this appeal.

2. I have heard both sides. The assessees have raised the contention that payment of commission to the agent was made only on 31.3.2008 and service tax on the same as recipient of services was paid only on 2.4.2008 and therefore refund claim is within the time limit of one year from the date of payment of service tax. Reference is made to Section 83 of the Finance Act, 1994 and since the relevant date for claim of service tax in terms of Explanation B (f) is the date of payment of service tax, refund claim filed on 19.3.2009 is within the time limit of one year stipulated under Section 11B as the service tax was paid on 2.4.2008. Further contention of the assessees is that no time limit for refund claim has been specified in Notification No.5/2006-CE, as per the decision of the Tribunal in GTN Engineering (I) Ltd. Vs CCE Coimbatore [2010 (259) ELT 625]. The contentions of the assessees are required to be considered afresh in the light of the case law cited by them. Since the Tribunals decision in GTN Engineering (supra) has been rendered subsequent to the passing of the impugned order, I

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set aside the order of the Commissioner (Appeals) and remit the case for fresh decision to the adjudicating authority who shall pass fresh orders in accordance with law after extending a reasonable opportunity to the assessees of being heard in their defence. 3. The appeal is thus allowed by remand.
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