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June 2015

2015 (38) S.T.R. 73 (Tri. – Mumbai) C.K.P. Mandal vs. Commissioner Of Service Tax, Mumbai-II

By Puloma Dalal, Jayesh Gogri, Mandar Telang Chartered Accountants
Reading Time 1 mins
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If the amount paid is not a ‘duty’ or “service tax”, no time limit applies for the refund of such amount collected without the authority of law.

Facts:
The appellants were charitable trust. They received donations from caterers and decorators for permitting them to use the halls. Service tax was demanded by department on donations. Ultimately, the Hon’ble High Court upheld that donations were not leviable to service tax. Therefore, refund claims were filed out of which one was sanctioned and another was rejected on the grounds of time-bar.

Held:
The Tribunal observed that for the sanctioned claim, interest has to be paid for delayed refund. For the rejected claim it was held that the time-bar u/s. 11B of the Central Excise Act, 1944 will apply only if the demand has been made or amount has been paid as ‘duty’ under the law. In the present case, no such demand was made under law. Hence, refund claim was allowed along with appropriate interest as payable under the law.

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