Judgment
IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH TUESDAY, THE 26TH DAY OF MARCH 2024 / 6TH CHAITHRA, 1946 WP(C) NO. 6541 OF 2020 PETITIONER/S:
1 MANIYAN PILLAI R, AGED 48 YEARS S/O. RAGHAVAN PILLAI, THOLIKKODU CHARUVILA VEEDU, MARUTHAMONPALLI, POOYAPPALLY P O, POOYAPPALLY VILLAGE, KOTTARAKKARA TALUK, KOLLAM DISTRICT.
2 SINDHU MANIYAN PILLAI, AGED 42 YEARS W/O.MANIYAN PILLAI, THOLIKKODU CHARUVILA VEEDU, MARUTHAMONPALLI, POOYAPPALLY P O, POOYAPPALLY VILLAGE, KOTTARAKKARA TALUK, KOLLAM DISTRICT.
BY ADVS. K.V.ANIL KUMAR; MOHANAN M.K.; RADHIKA S.ANIL
RESPONDENT/S:
1 UNION OF INDIA, REPRESENTED BY THE SECRETARY, MINISTRY OF FINANCE, DEPARTMENT OF REVENUE, NORTH BLOCK, NEW DELHI, PIN-110001.
2 THE COMMISSIONER OF CENTRAL TAX AND CENTRAL EXCISE, TRIVANDRUM COMMISSIONERATE, GST BHAVAN, PRESS CLUB ROAD, TRIVANDRUM, PIN-695001.
3 THE ASSISTANT COMMISSIONER, OFFICE OF THE ASSISTANT COMMISSIONER, CENTRAL TAX AND CENTRAL EXCISE, KOLLAM DIVISION, ST. MARY'S BUILDING, KADAPPAKKADA, KOLLAM, PIN-691008.
4 THE MANAGING DIRECTOR, KERALA STATE FINANCIAL ENTERPRISES LTD, HEAD OFFICE, THRISSUR, PIN-680020.
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BY ADVS.
SHRI.P.VIJAYAKUMAR, ASG OF INDIA SREELAL N. WARRIER, SC, CENTRAL BOARD OF EXCISE KURYAN THOMAS M.GOPIKRISHNAN NAMBIAR K.JOHN MATHAI JOSON MANAVALAN PAULOSE C. ABRAHAM RAJA KANNAN
OTHER PRESENT:
SRI. SREELAL N. WARRIER- SC
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 26.03.2024, ALONG WITH WP(C).39772/2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
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IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH TUESDAY, THE 26TH DAY OF MARCH 2024 / 6TH CHAITHRA, 1946 WP(C) NO. 39772 OF 2022 PETITIONER/S:
UDHAYAKUMAR.J, AGED 62 YEARS S/O R. JANARADHANANPILLAI, AMBADI, PRIYADARSHINI NAGAR, KILIKOLLOOR, KOLLAM DISTRICT, PIN - 691004
BY ADVS. BHARATH MOHAN N.KRISHNA PRASAD
RESPONDENT/S:
1 KERALA STATE FINANCIAL ENTERPRISES LIMITED, "BHADRATHA", MUSEUM ROAD, P.B. NO.510, THRISSUR DISTRICT, REPRESENTED BY ITS MANAGING DIRECTOR., PIN - 680020 2 THE MANAGER, KSFE, KOLLAM BRANCH,PATTATHUVILA PLAZA, VADAYATTUKOTTA ROAD, KOLLAM DISTRICT., PIN - 691001 3 THE ASSISTANT COMMISSIONER, CENTRAL TAX AND CENTRAL EXCISE, KOLLAM DIVISION, ST.MARY'S BUILDING, KADAPPAKADA, KOLLAM DISTRICT, PIN - 691008 4 THE SENIOR MANAGER (TAX), THE KERALA STATE FINANCIAL ENTERPRISES LTD., "BHADRATHA", MUSEUM ROAD, P.B. NO.510, THRISSUR DISTRICT, PIN – 680020
BY ADVS.
M.GOPIKRISHNAN NAMBIAR
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K.JOHN MATHAI JOSON MANAVALAN KURYAN THOMAS PAULOSE C. ABRAHAM RAJA KANNAN
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 26.03.2024, ALONG WITH WP(C).6541/2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
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J U D G M E N T [WP(C) Nos.6541/2020, 39772/2022]
In both writ petitions the common question of facts and prayers are involved. Therefore, the prayers from W.P.(C) No.6541/2020 are extracted hereunder to understand the reliefs sought in the writ petition:
“i. Issue a writ of mandamus or any other appropriate writ, order or direction, directing the 3rd respondent to refund the Service Tax amounts collected from various chitty transactions of the petitioners in different branches of the Kerala State Financial Enterprises Limited in Kollam District during the period of 2012 to 2015 immediately;
ii. Issue a writ of mandamus or any other appropriate writ, order or direction, to quash Ext.P7 and P8 order issued by the 3rd respondent and iii. Grant such other reliefs to the petitioners, as the Hon’ble Court may deed fit, in the interest of justice.”
2.
The facts of the lead petition W.P.(C) No.6541/2020
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are that the 1st petitioner has subscribed 25 chitties from the Kerala State Financial Enterprises Limited in Pooyappally Branch, between 2012 and 2015 and the 2nd petitioner has subscribed 11 chitties from the Kerala State Financial Enterprises Limited in Parippally Branch and Oyoor Branch in Kollam District. The petitioners had paid service tax on the subscription. However, given the judgment of the Supreme Court in the case of Union of India v. Margadarshi Chit Funds Private Ltd.1 a Division Bench of this Court, in the judgment dated 14.03.2018 in the All Kerala Association of Chit Funds v.
Union of India2 held that no service tax was leviable on a subscription on chitties between 01.07.2012 to 14.06.2015 and this Court directed for refund of the service tax if the application is made under the relevant provision, within a period of one year from the date of the judgment.
1 2017 (3) GST L3 (SC) 2 2018 (12) GSTL 142 (Ker)
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3.
The petitioners have made the applications within time. The petitioners’ applications have been rejected on the ground that the services provider/KSFE had also applied for the refund of the service tax paid by them during the relevant period which included the amount claimed by the petitioners.
Simultaneous filing of the refund applications by the service provider/KSFE and the service recipients/petitioners for the same amount could not be entertained.
4.
Learned Counsel for the petitioners submits that the petitioners have never authorized the KSFE to make the application for refund of service tax paid by them between 01.07.2012 to 14.06.2015 on the chitties subscribed by them between 2012 and 2015. Therefore, the petitioners' application ought not to have been rejected.
5.
Mr Sreelal Warrier learned Standing Counsel for the Department however submits that the KSFE had claimed that it had made the application on behalf of all the subscribers
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and, therefore, there could not have been two applications for refund and so their applications have been rejected. It is also submitted that there was an undertaking given allegedly by the petitioners to the KSFE that they would not make any individual application.
6.
Be that as it may, when the petitioners have made the applications individually in pursuance to the judgment dated 14.03.2018 passed by this Court, within one year from the date of the judgment, their applications ought not to have been rejected on some technical issue. These applications are in time and the authority, on examination, finds that they are eligible for a refund of the service tax amount paid by them as per the judgment dated 14.03.2018 passed by this Court, their applications ought to have been considered and the refund could have been credited to their accounts, if such refund is to be made under the judgment of this Court.
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7.
Therefore, I allow these writ petitions and remand the matter back to the Original Authorities to process the petitioners’ applications for refund of the service tax amount in pursuance of the judgment dated 14.03.2018 passed by this Court and pass fresh orders expeditiously, preferably within a period of two months. It is made clear that if the KSFE has claimed the refund on behalf of the petitioners also, such claim of the KSFE should be discarded by the Original Authority if it considers the application of the KSFE on behalf of other subscribers.
Sd/- DINESH KUMAR SINGH JUDGE
jjj
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APPENDIX OF WP(C) 39772/2022
PETITIONER EXHIBITS Exhibit P1 A TRUE COPY OF THE JUDGMENT DATED 14.03.2018 IN W.A NO. 474/2014 Exhibit P2 A TRUE COPY OF THE CERTIFICATE EVIDENCING COLLECTION OF AN AMOUNT OF RS.61,825/- ON 18.5.2015 DATED 7.3.2019 Exhibit P3 A TRUE COPY OF THE CERTIFICATE DATED 7.3.2019 EVIDENCING COLLECTION OF AN AMOUNT OF RS.43,277/- ON 20.4.2013 Exhibit P4 A TRUE COPY OF THE CERTIFICATE DATED 7.3.2019 EVIDENCING COLLECTION OF AN AMOUNT OF RS.17,321/- TOWARDS SERVICE TAX ON 15.12.2012 Exhibit P5 A TRUE COPY OF THE CERTIFICATE DATED 7.3.2019 EVIDENCING COLLECTION OF AN AMOUNT OF RS.61,825/- ON 17.4.2015 Exhibit P6 A TRUE COPY OF THE CERTIFICATE DATED 7.3.2018 EVIDENCING COLLECTION OF RS.43,277/- ON 21.1.2013 Exhibit P7 A TRUE COPY OF THE ORDER OF THE THIRD RESPONDENT DATED 18.9.2019 IN RESPECT OF EXT.P2 Exhibit P8 A TRUE COPY OF THE ORDER IN RESPECT OF EXT.P3 DATED 18.9.2019 Exhibit P9 A TRUE COPY OF THE ORDER IN RESPECT OF EXT.P4 DATED 18.9.2019 Exhibit P10 A TRUE COPY OF THE ORDER IN RESPECT OF EXT.P6 DATED 18.9.2019 Exhibit P11 A TRUE COPY OF THE REPRESENTATION DATED 06.10.2022 PERTAINING TO ONE OF THE CHITTY
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TRANSACTIONS Exhibit P12 A TRUE COPY OF THE REPLY DATED 01.11.2022 FROM THE BRANCH MANAGER KOLLAM Exhibit P13 A TRUE COPY OF THE LETTER DATED 22.10.2022 FROM SENIOR MANAGER KSFE HQ TO BRANCH MANAGER KOLLAM
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APPENDIX OF WP(C) 6541/2020
PETITIONER EXHIBITS EXHIBIT P1 A TRUE COPY OF THE SHOW CAUSE NOTICE OF KSFE LIMITED, POOYAPPALLY BRANCH DATED 18.07.2019 ISSUED BY THE 4TH RESPONDENT.
EXHIBIT P2 A TRUE COPY OF THE SHOW CAUSE NOTICE OF KSFE LIMITED, PARIPPALLY BRANCH, DATED 18.07.2019 ISSUED BY THE 4TH RESPONDENT TO THE 1ST PETITIONER.
EXHIBIT P3 A TRUE COPY OF THE SHOW CAUSE NOTICE OF KSFE LIMITED, PARIPPALLY BRANCH, DATED 16.05.2019 ISSUED BY THE 4TH RESPONDENT TO THE 2ND PETITIONER.
EXHIBIT P4 A TRUE COPY OF THE SHOW CAUSE NOTICE OF KSFE LIMITED, PARAVOOR BRANCH, DATED 18.07.2019 ISSUED BY THE 4TH RESPONDENT.
EXHIBIT P5 A TRUE COPY OF THE SHOW CAUSE NOTICE OF KSFE LIMITED, OYOOR BRANCH DATED 18.07.2019 ISSUED BY THE 4TH RESPONDENT TO THE 1ST PETITIONER.
EXHIBIT P6 A TRUE COPY OF THE SHOW CAUSE NOTICE OF KSFE LIMITED, OYOOR BRANCH DATED 16.05.2019 ISSUED BY TH 4TH RESPONDENT TO THE 2ND PETITIONER.
EXHIBIT P7 A TRUE COPY OF THE ORDER 10501/2019-20-ST(R)- KSFE(SUB) DATED 19.09.2019 OF KSFE LIMITED, PARIPPALLY, BRANCH, ISSUED BY THE 3RD RESPONDENT.
EXHIBIT P8 A TRUE COPY OF THE ORDER NO.10502/2019-20 ST (R) KSFE(SUB) DATED 19.09.2019 OF KSFE LIMITED, OYOOR BRANCH ISSUED BY THE 3RD RESPONDENT.