Decided on July 07,2015

Commissioner Of Central Excise, Kanpur Appellant
Kay Trading Respondents


H.K.THAKUR,J - (1.)APPEAL No. ST/208/2010 has been filed by Revenue against OIA No. 211 -ST/APPL/KNP/2009, dated 6 -7 -2009. Appeal No. ST/209/2010 has also been filed by Revenue against OIA No. 178 -ST/APPL/KNP/2009, dated 8 -6 -2009. As the issue involved in both these appeals is the same, therefore, both are taken up for disposal under this common order.
(2.)Shri Govind Dixit (AR) and Shri B.B. Sharma (AR) appeared in these proceedings on behalf of the Revenue. It was argued that first appellate authority has held that refund claim cannot be rejected as time -barred in view of C.B.E. & C. Circular No. 137/84/2008 -CX, dated 12 -3 -2009. That Commissioner (Appeals) has wrongly applied the ratio of C.B.E. & C. Circular dated 12 -3 -2009 to refund of service tax paid on commissions while sanctioning refund @ 10% of FOB instead of 2% of FOB. It was strongly argued by learned ARs that amending Notification No. , dated 7 -12 -2008 will be effective from 7 -12 -2008 only and cannot be given retrospective effect as interpreted by the first appellate authority.
None appeared for the respondent whom notice of hearing was issued. There is also no request for any adjournment. Heard learned ARs and perused the case records. The only issue required to be deliberated in these proceedings is whether respondent's were eligible to refund @ 2% of FOB value on Commission Agent Service or 10% of FOB value as a result of amending Notification No. , dated 7 -12 -2008, carried out in Notification No. , dated 6 -10 -2007. As per Notification No. , dated 6 -10 -2007 before its amendment, a refund equivalent to 2% of FOB value of the commission was admissible. As a result of amendment to Notification No. , by Notification No. , made the refund admissible @ 10% from 2% admissible earlier. Commissioner (Appeals) has held that amendment in the rate of refund admissible w.e.f. 7 -12 -2008 will have retrospective on the analogy of C.B.E. & C. File No. 137/84/2008 -CX, dated 12 -3 -2009. C.B.E. & C. where it has been clarified that the benefit of amendment made in Notification No. , regarding extending of time limit for filing refund claim, can be given retrospectively. It has thus been held by the first appellate authority that if one amendment to Notification No. can be given retrospective effect then admissibility of refund @ 10% by an amendment with effect from 7 -12 -2008, should also be given retrospective effect. We do not agree with the findings of Commissioner (Appeals) as any amendment to a notification will have only prospective effect unless specifically made retrospective by the appropriate authority. No notification can be given retrospective by an executive instruction. Accordingly we allow the appeal filed by the Revenue by setting aside the order -in -appeal passed by the first appellate authority.

(Operative part of the order pronounced in the open Court)


Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.