By Puloma Dalal, Jayesh Gogri, Mandar Telang, Chartered Accountants
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Where service tax was paid for one period under protest, any amount paid for later period on identical issue was deemed “under protest” and limitation period was held inapplicable.
Facts:
The department disputed assessee’s valuation method and passed an adjudication order confirming the demand. The assessee filed a protest letter under Rule 233B during the course of adjudication. Preferring an appeal before the Commissioner (Appeals), the matter was decided in assessee’s favour.
During the pendency of Appellate proceedings, the assessee paid the duty for subsequent period based on the valuation method adopted by the 21 adjudicating authority for the period under dispute. Later, the assessee applied for refund covering period under dispute as well as subsequent period which was rejected by the department on the ground of limitation. Relying on Mafatlal Industries Ltd. vs. Union of India 1997 (89) ELT 247 (SC), the assessee appealed against the order rejecting refund and was decided in its favour.
Held:
Dismissing the department’s appeal and relying on the Hon. Supreme Court’s decision in Mafatlal Industries (supra), the Hon. High Court observed that the payment made when the assessee was challenging the earlier levy of duty was deemed to be made under protest and not otherwise and that no limitation period was applicable to the payment made under protest.
