2011 (27) S.T.R. 18 (Tri.- Kolkata)

PJ/Case Laws/2012-13/1258

Case:- EAST INDIA MINERALS LTD. versus COMMR. OF C. EX., CUS. & S.T., BHUBANESWAR

Citation:- 2011 (27) S.T.R. 18 (Tri.- Kolkata)

Brief Facts:- The Appellant filed refund claim of service tax on GTA services for transport of export goods directly from place removal to the port. Service tax refunds on GTA services were denied to the assessee on the grounds that refund of service tax on GTA services is available only from ICD to port.

Appellant Contention:- The Appellant said that as the refund was admissible on the date of filing the claim, the same should be allowed. He also refers to the Government's policy that export goods should not be 'burdened with the domestic taxes and the export goods should not be made costly and less competitive in the foreign market.

Respondent Contention:- The Respondent supports the impugned order and states that the refund was not admissible on the date of export and hence the same cannot be allowed.

Reasoning of Judgement:- We have considered the arguments from both sides. We find that the impugned exemption notification allowing refund of service tax paid in respect of exports has been issued with the sole objective of removing the burden of service tax from the export goods. It has been rightly contended by the respondent that it is the avowed policy of the Government not to export domestic tax along with export goods and to make such goods competitive in the foreign market.
We also find that in the case of WNS Global Services (P) Ltd. v. C.C.E., Mumbai - 2008 (10) S.T.R. 273 (Tri.-Mumbai), that when the claims satisfy the requirements under the amended rules, the refund claims should not be rejected. We further find that when the time-limit for filing the refund claim was increased from 60 days to 6 months by amending the Notification No. 41/07-S.T., on 18-11-2008, the Board itself by circular dated 12-03-2009 clarified that pending claims should be dealt with applying the amended provision as also noted by another Bench of the Tribunal in the case of C.C.E., Surat v. Essar Steel Ltd. – 2010 (20) S.T.R. 769 (Tri.-Ahmd.). Following the ratio of the above cited decisions, and the Board's circular, and also keeping in view the objective of the Government policy to encourage exports and not to burden the export goods with domestic taxes, we are of the view that the impugned refund claims should be allowed, if otherwise due, since on the date of filing the claims, the requirement of the notification has been satisfied and the service taxes paid in respect of GTA services used for transport of the impugned goods for export from the place of removal to the port have become refundable. Accordingly, we set aside the impugned order and allow both the appeals with the direction that the refund be sanctioned, if otherwise due. Both the appeals are allowed.

Decision:- Appeal Allowed.

Comment:- This valuable judgment has brought the ratio decindandi that the service tax refund is applicable even prior to the date of amendment. The reasoning taken by tribunal to reach this conclusion is that the intention of the government was to promote export competitive and hence they have provided the refund. The exporter will take the refund and his cost will be reduced. Following the same, the refund was allowed even for a period prior to amendment.

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PJ/Case Laws/2012-13/1258

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