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PJ/Case Laws/2011-12/1118

Can refund of service tax paid regarding services used in export of goods be rejected on ground of absence of documents to provide proper correlation between exported goods and that service used?

Prepared By:
CA. Rajani Thanvi & 
Bharat  Rathore

 


Case:  ITC Ltd. Vs Commissioner of Central Excise, Salem

Citation:2011(22) S.T.R. 92 (Tri.- Chennai)

Issue:Can refund of service tax paid regarding services used in export of goods be rejected on ground of absence of documents to provide proper correlation between exported goods and that service used?

Brief Facts:  The respondent have several units engaged in manufacture of finished goods which are partly exported and partly cleared for home consumption. The export has been done in a consolidated manner from appellant’s Hyderabad office and service tax on input services viz., CHA service, GTA service and Banking and other Financial services paid from Hyderabad office. There is no dispute about the exports having been made and also the use of the input services on payment of tax for the same but appellant do not provide a proper co-relation between the exported goods relating to the Mettupalam unit, the input services used and the tax paid on the same.

Appellant’s contention:- The appellant submit that they have produced all the documents relating to export and there is no dispute regarding export having been made and use of the input service in export. The appellant also submit that appellants should be given a second chance to file necessary documents with adequate details alongwith a Chartered Accountant’s certificate.

Respondent’s Contention: Respondent submit that there is no dispute about export have been done and said services has been used in export and payment of tax for the same. But appellant has not co-relate the exported goods relating to the Mettupalam unit, the input services used and the tax paid on the same.

Reasoning of Judgment: - The Hon’ble Tribunal viewed that exports made by the appellant are not in dispute and impugned input services are specifically listed in the impugned notification entitling the appellants to grant of refund of services tax paid on such input services and they should be given a second chance to substantiate their claim by filing adequate documents with necessary details alongwith Chartered Accountant’s certificate, before original authority. Accordingly, Impugned order is set aside and the matter is remanded for fresh decision to the original authority

Judgment:The appeal is allow by way of remand.

Comment:Exporter will find some relief by this judgment. As refund claims of service tax can not be rejected merely on the basis of not submitting adequate documents to establish the nexus between the service and export.

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