PARIJAT CONSTRUCTION Vs. COMMISSIONER OF CENTRAL EXCISE, NASHIK

JUDGEMENT

(1.) The appellants by the present appeals are challenging a common order dated 5th May, 2016 passed by the Customs, Excise and Service Tax Appellate Tribunal, West Zonal [Bench] at Mumbai (for short "Appellate Tribunal") by which the Orders-in-Appeal Nos. AKP/104/NSK/2009 and AKP/104/NSK/2009, both dated 18th November 2009 passed by the Commissioner (Appeals) of Central Excise and Customs, Nashik were upheld. For the sake of convenience, we are referring to the facts in Appeal No. 306 of 2016.

(2.) The appellant is engaged in providing "Commercial or Industrial Construction" service and are registered as a service provider under that category. The appellant had during the period May 2006 to November 2007 secured a contract from Mumbai Educational Trust for construction of administration and Core Course building. The appellant being under the bona fide belief that the transaction attracts Service Tax paid the same without collecting the same from the customer and deposited it to the credit of the Central Government. The appellant filed a refund claim on 11th March, 2008 for Rs. 12,62,900/-. The refund claim was filed as the appellant had provided construction services for use of organisation or institutions being established solely for educational, religious, charitable, health, sanitation or philanthropic purposes and not for purposes of profit and were thus exempted as per the departmental clarification issued under para 13.2 of C.B.E. and C. Circular No. 80/10/2004-S.T., dated 17th September 2004. A show cause notice dated 30th May, 2008 issued to the appellant by the Assistant Commissioner to show cause as to why the appellant's claim for refund shall not be rejected. The appellant filed a detailed reply to the show cause notice. The Assistant Commissioner vide Order-in-Original No. 05/ST(R)/2009, dated 31st March, 2009 rejected the refund claim for Rs. 9,73,292/- filed by the appellant as not been sustainable on account of the refund claim being time barred under the provisions of Section 11B of the Central Excise Act, 1944. The refund claim of Rs. 2,89,608/- was allowed. The appellant being aggrieved and dissatisfied with the said orders filed appeal before the Commissioner of Central Excise (Appeals), Nashik. By Order-in-Appeal dated 18th November, 2009, the Commissioner (Appeals) partly allowed the appeals of the appellant to the extent of Rs. 73,330/- and for the remaining amounts the Orders-in-Original were upheld. The appellant filed appeal before the Appellate Tribunal challenging the said order of the Commissioner (Appeals). By the impugned order dated 5th May, 2016, the Appellate Tribunal dismissed the appeal filed by the appellant. Hence the present appeal has been filed.

(3.) Mr. Raichandani, learned counsel for the appellant has submitted that Section 11B of the Central Excise Act which prescribes the time period of one year for filing a refund claim is inapplicable in the case of refund for Service Tax which was paid under mistake of law. Mr. Raichandani has further submitted that the Appellate Tribunal has erroneously applied Section 11B of the said Act in the present case where admittedly the appellant had paid service tax on commercial or industrial construction service though such service was not leviable to service tax. The Appellate Tribunal has arrived at an erroneous finding that since refund of any amount is governed by Section 11B, there would be no other provision of limitation for filing a refund claim and that the Appellate Tribunal being a creature under the Central Excise/Customs Act cannot go beyond the statute and relax time prescribed under the statute. The Appellate Tribunal rejected the refund claim of the appellant on the ground that it was filed after one year and hit by limitation and thereby they upheld the orders of the Commissioner (Appeals). Mr. Raichandani has relied upon a judgment of the Division Bench of this Court in Hindustan Cocoa Products v. Union of India, 1994 (74) E.L.T. 525 (Bom.) and another judgment of Division Bench of this Court (Nagpur Bench) in the case of The Commissioner Central Excise, Nagpur v. M/s. SGR infratech Ltd., Central Excise Appeal No. 26 of 2014, dated 28th October, 2015 in support of his contention that, the limitation prescribed under Section 11B of the said Act is not applicable, where admittedly the tax could not have been demanded and/or service tax was paid under a mistake of law. Mr. Raichandani has also submitted that the Supreme Court order relied upon by the Appellate Tribunal viz. Collector of C.E., Chandigarh v. Doaba Co-Operative Sugar Mills, 1988 (37) E.L.T. 478 (S.C.) would not be applicable as an exception has been culled out in cases where duty was paid under the mistake of law. In the present case where admittedly the appellant had paid service tax on Commercial or Industrial Construction Service although such services were not liable to Service Tax.