Whether in the light of the principle of unjust enrichment recipient of service can claim refund u/s. 11B of Central Excise Act if ultimate burden of service tax liability has been borne by him?

Commissioner  of Customs,   Central   Excise  & Service  Tax vs. Indian   Farmers    Fertilizers    Cooperative    Ltd. [2014] 48 taxmann.com     79 (Allahabad)

  

FACTS:

An  assessee,  a service  recipient,  received  services  of transport  of  natural  gas from  Mis.  RGTIL falling  under "Transport of Goods other than Water through Pipeline or other  Conduit  Services."  Transmission charges payable, are fixed by a regulatory  body.  Invoices  are  raised  on the basis of the provisional  rates notified. Later, the tariff was  approved  with  retrospective  effect  resulting  into  a downward   revision.  The  adjudicating  authority  allowed refund   claim   of  the   assessee   for   the   proportionate excess service tax remitted by RGTIL and borne by him. Appellate  authority  reversed this order in appeal filed by the  Revenue  on the ground  that claim  was filed  by the service  receiver and that the expression  "any person"  in section 11B of the Central Excise Act, 1944 did not include the  service  receiver.  The  Tribunal  allowed  the  refund. The  Revenue  raised  two  additional  contentions   before the High Court namely limitation for applying  refund and principle of unjust enrichment.

HELD:

The  Additional   issues   raised   were   not  accepted   on the ground that they were not raised before and the observations   of  adjudicating   authority  allowing   refund go in favour  of assessee.  The High Court relying on the decision of Mafatlal industries   Ltd. VS.   Union of India 1997 (89) ELT 247 held that the assessee is entitled to claim a refund of excess service tax paid.