When service is not provided, question of payment of service tax does not arise and so also that of unjust enrichment
THE brief facts of the case are that the appellants are engaged in the activity of online information and data access service. They entered into a deal with one M/s Knowledgeworks Global Ltd. and as per their deal , they issued invoices for the services provided to them and raised a debit note along with service tax payable and within 14 days of the issuance of the notice, they paid service tax also, although during the relevant time, service tax was payable on receipt. Later on, no deal was finalized .
Accordingly, credit note was issued and appellant filed a refund claim for service tax paid on the services which were not provided at all.
Revenue rejected the refund claim on the premise that the appellant has failed to pass the bar of unjust enrichment.
Before the CESTAT, the appellant submitted that since they had not provided any service, question of unjust enrichment does not arise.
The Bench held-
"6. This fact is not in dispute that the appellant has not provided any service at all. When service is not provided, question of service tax does not arise. The appellant has filed a refund claim of the service tax paid. Therefore, question of unjust enrichment does not arise."
The appeal was allowed and the adjudicating authority was directed to grant refund within 30 days.