This is with reference to Captioned Subject.

In most of the cases Central Excise Department has issued SCN demanding Service Tax on TTA  and Royalty paid under category of “ Consulting Engineering Services” .

Industry has taken a stand that TTA and Royalty paid cannot be classified under “ Consulting Engineering Services”, but covered under “ Intellectual Property Services” and taxable only w.e.f. 10.09.2004.

Now there are plethora of cases available where it has been held that TTA and Royalty can not be classified under “ Consulting Engineering Services”, and is taxable only w.e.f. 10.09.2004. under “ Intellectual Property Services”.

In recent Case of M/s. Shipowners Association of India Vs Union of India ( Dated 11^th December 2008), reported in 2008- TIOL-633-HC-Mum-ST ( Copy enclosed)  , Mumbai High court has held that before enactment of Section 66 A ( i.e. before 18^th April 2006) there was no authority vested by law with Government of India to levy Service Tax on a person who is resident in India, but who receives services from Out of India ( Under reverse Charge as per provision of Rule 2(1) (d) (iv)).

My query is

1. Can Assessee take advantage of above judgment and ask for refund of “Service Tax” collected by department as it was “Collected without authority of law”?
2. In most of the cases, Service tax amount may be “revenue neutral” as assessee may have taken credit of the same – but for those who have not taken credit it may be cost.
3. Can Assessee ask for refund of “interest paid “on late payment of service tax? In most of the cases companies paid “service tax” on TTA under IPS late with interest.   
4. If the service tax is paid against demand – can it be called as paid under protest – This will help to take advantage of Section 11 B (7) , where there is no time limit to claim refund if duty is paid under protest.
5. Whether doctrine of “Unjust enrichment” will come into play in this refund?

Please let me know your valued views.

Regards,

Rajesh Shukla