A refund cannot be granted unless the underlying self-assessment is first modified on appeal.

Sodexo entities provided housekeeping and canteen/outdoor-catering services to educational institutions and paid service tax on those services.

After the CBEC clarified that such services could qualify as auxiliary educational services exempt under Notification No. 25/2012-ST, the appellants sought refunds under Section 11B of the Central Excise Act, 1944, as applied to service tax by Section 83 of the Finance Act, 1994.

The Commissioner (Appeals) allowed refunds of ₹1,20,95,023 for housekeeping services but directed that ₹4,70,89,131 relating to canteen/outdoor-catering services be credited to the Consumer Welfare Fund on grounds of unjust enrichment.

Both the assessees and Revenue appealed.

Whether the refund claims were maintainable when the self-assessments reflected in the appellants’ service-tax returns had not first been modified or set aside through the statutory process.

Whether the claims for July–December 2012 were barred by the one-year limitation under Section 11B, or whether limitation ran from the CBEC clarification dated 19 September 2013.

Whether the appellants established that they bore the incidence of service tax, so that the refunds could be paid to them rather than credited to the Consumer Welfare Fund.

Section 11B of the Central Excise Act, 1944, applied to service tax by Section 83 of the Finance Act, 1994, governs refund claims, including limitation and the requirement to establish that the incidence of tax was not passed on.

Under ITC Ltd. v. CCE (2019), a self-assessment is an assessment order; a refund authority cannot revisit it, and a refund claim is not a substitute for an appeal or reassessment.

The Tribunal also relied on Flock (India) and Priya Blue Industries for the rule that an assessment must be challenged through the prescribed appellate process before its correctness can be raised in refund proceedings.

The CBEC clarification could clarify the exemption but was not an appellate or reassessment order capable of altering the appellants’ self-assessments.

On unjust enrichment, Section 11B and the principles in Addison & Co. Ltd. require proof that the claimant did not pass on the tax burden; issuing credit notes alone does not necessarily establish that downstream customers did not bear it.

The Tribunal treated the service tax reported and paid by the appellants as arising from their self-assessments. Because those assessments had not been modified through the statutory appellate or reassessment process, the refund claims could not be used to obtain a fresh determination of whether the services were exempt.

The Board’s clarification did not alter that result: it was neither an appellate decision nor an order setting aside the assessments.

Accordingly, the Tribunal rejected the appellants’ limitation argument based on the clarification date.

It also considered the unjust-enrichment principles, including the insufficiency of post-payment credit notes where the ultimate burden may have been passed to service recipients.

The refund relief granted by the Commissioner (Appeals) was therefore not sustained; the Tribunal held that the claims could not be maintained without first setting aside or modifying the relevant self-assessments.