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June 2015

2015 (38) S.T.R. 77 (Tri.-Ahmd.) Commissioner of Central Excise & Service Tax, Bhavnagar vs. HK Dave Ltd.

By Puloma Dalal, Jayesh Gogri, Mandar Telang Chartered Accountants
Reading Time 1 mins
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The amount paid during investigation takes colour of ‘deposit’. Therefore, there is no time limit for refund of such amount.

Facts:
The respondents paid an amount during the course of investigation. Since they had won the case on merits, a refund claim was filed. Revenue argued that since the claim was filed after 1 year from the date of CESTAT’s order, it was time barred vide section 11B of the Central Excise Act, 1944.

Held:
It was held that the amount was paid during investigation and not at the time of rendering of services, thus amount paid by the respondents cannot be termed as ‘duty’ but it was a ‘deposit’. Therefore, bar contained in section 11B of the Central Excise Act, 1944 was not applicable. The action of the Respondent contesting issue on merits constituted a case of ‘deemed protest’ and no time limit will be applicable as per the Second Proviso to section 11B of the Central Excise Act, 1944. Therefore, the appeal filed by revenue was rejected

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