1. Heard both the sides. This is an appeal filed against Order-in-Appeal No. OIA-AHM-EXCUS-002-APP-118-17-18 passed by the Commissioner of Central Excise (Appeals), Ahmedabad. Briefly stated the facts of the case are that the appellant had filed a refund claim under Section 102(2) of Finance Act, 2016 on 27-10-2016 for an amount of Rs. 42,39,861/- being service tax paid dur
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ing the period 1-4-2015 to 29-2-2016 in respect of services provided to various Municipal/Government Organizations which became exempted retrospectively by virtue of Section 102(1) of the Finance Act, 2016. The aforesaid service tax amount was discharged during the said period by utilizing Cenvat credit amount of Rs. 18,25,194/-. The authorities below had sanctioned the refund claim of Rs. 24,14,667/- paid through cash, however, rejected the refund amount of Rs. 18,25,194/- paid by way of debiting their Cenvat credit account, observing that such refund would result in double benefit to the appellant.
2. Ld. CA for the appellant vehemently argued that by virtue of Section 102(1) of the Finance Act, 2016, the service tax which has been collected from the appellant on the services mentioned thereunder rendered to Government/public authorities during the period i.e. 1-4-2015 to 29-2-2016, were allowed to be refunded, hence, the mode/payment of service tax, during the relevant period, becomes irrelevant. It is his contention that under Section 102(2) of the Finance Act nowhere it is stipulated that the amount paid by utilizing through cash only would be refunded and Cenvat credit used in discharging service tax during the relevant period would not be eligible to refund. He submits that mode of payment of service tax being immaterial, therefore, authorities below ought to have allowed the refund claim of Rs. 18,25,194/- paid during the period from 1-4-2015 to 29-2-2016 utilizing their Cenvat credit account. It is his contention that there is no notice issued by the department alleging that the Cenvat credit is not admissible to them.
3. Ld. AR for the Revenue reiterated the findings of Ld. Commissioner (Appeals). I find that there is no dispute of the fact that the appellant have rendered the services which became exempted from service tax retrospectively and accordingly the appellant became eligible to refund of the service tax paid during the period from 1-4-2015 to 29-2-2016 by virtue of Section 102(2) of the Finance Act, 2016. Even though the authorities below had not rejected the refund on merit but a portion of the refund amount was disallowed on the ground that while discharging their Service Tax liability during the relevant period, the amount of Rs. 18,25,194/- has been paid from their Cenvat credit account and refund of said Cenvat credit account would result into double benefit. The argument of the Revenue is fallacious inasmuch as by virtue of Section 102 the said Finance Act, 2016, service tax collected during the period on specified services allowed to be refunded on fulfillment of the conditions laid down under the said Finance Act. Nowhere under the said Finance Act, mode of payment of service tax, was a condition for allowing refund of the amount of service tax paid during the period in question. Therefore, it is difficult to appreciate how double benefit of the refund allowed under Section 102(2) of Finance Act, 2016 would accrue to the appellant once the amount paid by utilizing Cenvat credit if now refunded to their Cenvat credit account only. Further, there is no allegation on the aspect of eligibility of Cenvat credit availed and utilized by them during the said period. In these circumstances, I do not find merit in the impugned order, accordingly the same is set aside and the appeal is allowed with consequential relief, if any, as per law