Whether service tax refund on documentation, repo charges allowed?

PJ/Case law/2014-15/2223

Case:- COMMR. OF C. EX., AHMEDABAD Versus AMEE CASTORS & DERIVATIVES LTD.

Citation:- 2013 (30) S.T.R. 467 (Tri. - Ahmd.)

Brief facts:-Refund claim filed by the respondent under Notification No. 41/2007-S.T. in respect of Service Tax paid by them on export goods was allowed by the original adjudicating authority and the Commissioner took up the revision of the same. After considering the submissions of the respondent, learned Commissioner sanctioned the refund claims and Revenue is in appeal against the order-in-revision passed by the Commissioner allowing the refund of the respondent.

Appellant’s contentions:- Learned departmental representative submits that the Commissioner in his revision order has not given detailed finding and refund of Service Tax paid on THC, Documentation charges, Repo charges, Examination charges, Customs Clearance charges, etc., are not covered under Port Services but under the Business Auxiliary Services, which is not a specified service. Further, he also submits that as regards fumigation charges, refund of Service Tax should not have been allowed in the absence of submission of copy of written agreement between the exporter and the buyer.

Respondent’s contentions:- The authorized representative of the respondent relies upon the decision of the Tribunal in the case of Ramdev Food Products vide Order No. A/861-863/WZB/HAD/2010, dated 30-6-2010 [2010 (19) S.T.R. 853 (Tribunal] to submit that the refund of THC, Repo charges, etc., objected by the Revenue above are admissible. As regards fumigation charges, he would submit that it is legal requirement to provide fumigation for the goods supplied by them and therefore, written agreement should be insisted upon.

Reasoning of judgment:- Theyfind that the decision of the Tribunal in the case of Ramdev Food Products squarely covers the issue and the specific items on which the refund is proposed to be denied by the Revenue are covered in the decision of this Tribunal in the case of Ramdev Food Products. Respectfully following the decision, They hold that respondent is eligible for refund on THC, Repo charges, Documentation charges, etc.
As regards, the fumigation charges, They find that Notification No. 41/2007 specifically provides two conditions for grant of refund and the conditions are :-
(i)     Exporters furnishes the copy of written agreement entered into with the buyers of the such goods requiring such specialized cleaning of containers used for export of goods, and
(ii)    The service provider accredited by the competent statutory authority to provide such specialized cleaning services.
In the absence of written agreement and in the absence of fulfilment of these conditions, refund cannot be allowed.
In view of the above, appeal filed by the Revenue in respect of refund of Service Tax paid on fumigation charges is allowed and in respect of other services is rejected.

Decision:- Appeal partly allowed.

Comment:- The analogy of the case is that refund on THC, Repo charges, Documentation charges, etc., is admissible in view of the decision of the Tribunal in the case of Ramdev Food Products case. However, refund of the fumigation charges was not admissible in the absence of written agreement and in the absence of fulfilment of the conditions stipulated in Notification No. 41/2007-S.T. As of now, there are no such conditions and the service tax refund is governed by the amended notification no. 41/2012-ST dated 29.06.2012.

Prepared by:- Monika Tak

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PJ/Case law/2014-15/2223

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