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2026 Supreme(Online)(CESTAT) 1648
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL NEW DELHI PRINCIPAL BENCH - COURT NO. III
Binu Tamta, Judicial Member, P.V. Subba Rao, Technical Member
CHANDRA SINGH SAMAR – Appellant
Versus
UDAIPUR – Respondent
Service Tax Appeal No.52893 OF 2018
For the Appellants/Petitioners: None
For the Respondents: Mahboob Ur Rehman
A refund claim for service tax paid via self-assessment is not maintainable unless the original assessment order is challenged or modified, as refund proceedings are execution-oriented and not for re-assessment of merits.
Headnote:(A) Refund Claims - Nature of Proceedings - Refund proceedings are essentially execution proceedings; the authority processing the refund cannot conduct a fresh assessment on merits or correct an assessment based on a mistake. (Para 6)
(B) Self-Assessment - Legal Status - A self-assessed return is equivalent to a formal order of assessment and attains finality unless it is modified or set aside through an appeal. (Para 7, 8)
(C) Maintainability of Refund - Requirement to challenge assessment - A refund claim is not maintainable if the original assessment order (including self-assessment) has not been challenged, as the amount was paid in discharge of a liability that has attained finality. (Para 8)
Issues: Whether a refund claim for service tax paid under self-assessment is maintainable without challenging the original assessment order.
| Table of Content |
|---|
| 1. facts regarding the refund claim for works contract service provided to a local authority. (Para 1 , 2 , 3 , 4) |
| 2. refund proceedings are execution proceedings and self-assessment is equivalent to a formal assessment order. (Para 5 , 6 , 7) |
| 3. refund claims are not maintainable without challenging the original self-assessment order. (Para 8 , 9 , 10) |
BINU TAMTA:
1. M/s. Chandra Singh Samar, The Appellant has challenged the impugned order, Order-in-Appeal No.650(CRM)ST/JDR/2018 dated 26.06.2018 rejecting the refund claim in respect of service tax paid on „Works Contract Service‟.
2. The appellant is engaged in providing services under the category ’Works Contract Service” and registered with the Service Tax Department. They have filed refund claim of Rs.9,10,785/- in respect of service tax paid on “Work Contract Service” on construction of (G+3) residential Complex service provided to the Urban Improvement Trust (UIT), Udaipur treating it as non-taxable service as they provided service to a local Govt. Authority which as per the appellant is exempted from payment of service tax under Sr. No.12 of Notification 25/2012-ST dated 20.06.2012, whereby the services provided to the Govt., a local Authority or a Govt. Authority by way of construction, erection, commissioning, installation completion, fitting out, repair, maintenance, renovation, or alteration of civil structure or any other original work meant predominantly for use other than for commerce, industry, or any other business or profession.
3. Show Cause Notice dated 20.02.2014 was issued to the appellant wherein it was alleged that the appellant interpreted the definition wrongly and claimed a refund of service tax paid, which is not admissible to them and liable to be rejected. The Adjudicating Authority vide Order-in-Original dated 14.03.2014 rejected the refund claim of Rs.9,10,785/- filed by the appellant. The appellant preferred an appeal before Commissioner (Appeals), who vide Order-in-Appeal dated 26.06.2018 upheld the impugned order and rejected the appeal filed by the appellant. Hence the present appeal.
4. Heard Shri Mahboob Ur Rehman, learned Authorised Representative for the Department and perused the case records.
5. The short question to be considered is whether the appellant is entitled to claim refund of the service tax amount paid by them.
6. The impugned order has been passed prior to the decision of the Apex Court in ITC Limited Vs. CCE, Kolkata-IV , 2019(368) ELT 216 (SC) deciding the eligibility to claim refund and therefore, the present appeal has to be decided in view of the law laid down therein. The Apex Court has held that refund provisions are more or less in the nature of execution proceedings and it is not open to the Authority which processes the refund to make a fresh assessment on merit and to correct assessment on the basis of mistake or otherwise. Para 44 of the judgement reads as follows:-
“44. The provisions under Section 27 cannot be invoked in the absence of amendment or modification having been made in the bill of entry on the basis of which self-assessment has been made. In other words, the order of self-assessment is required to be followed unless modified before the claim for refund is entertained under Section 27 . The refund proceedings are in the nature of execution for refunding amount. It is not assessment or re-assessment proceedings at all. Apart from that, there are other conditions which are to be satisfied for claiming exemption, as provided in the exemption notification. Existence of those exigencies is also to be proved which cannot be adjudicated within the scope of provisions as to refund. While processing a refund application, re-assessment is not permitted nor conditions of exemption can be adjudicated. Re-assessment is permitted only under Section 17(3)(4) and (5) of the amended provisions. Similar was the position prior to the amendment. It will virtually amount to an order o
