Refund of service tax for export of goods cannot be denied without verification of documents.

PJ/Case Laws/ 2012-13/ 1187

CASE: BODAL CHEMICALS LTD. V/S COMMISSIONER OF CENTRAL EXCISE, AHMEDABAD

CITATION: 2012 (27) S.T.R 276 (TRI. - AHMRDABAD)

ISSUE: - Refund of service tax for export of goods cannot be denied without verification of documents.

BRIEF FACTS:
1)The refund claim of service tax paid on various services namely transport of goods by road, transport of goods by rail, agency charges and port charges and commission charges for export of goods has been rejected. In respect of transport of goods by rail, the claim has been rejected on the ground that no evidence has been produced to show that the service provider has not availed Cenvat credit of service tax.
2) The refund of service tax paid on Port service has been rejected on the ground that service provider was not authorized by the port.
3) Whether the service tax paid on services of Commission agents located abroad is available or not.

REASONING OF JUDGEMENT:-

It was submitted for the transportation of goods by rail that the C & F agent has played the role as clearing agent and he had paid for transportation by rail on behalf of the appellant and copy of the invoice issued by CONCOR is produced. As regards transportation of goods by road, it has been held that appellant has shown only invoice number. However, attention has been drawn to the covering letter dated 30-3-2009 under which at serial No. 4 of the covering letter invoice along with attested copies of shipping bills and bills of lading and bank realization certificate are said to be attached. However, learned counsel submitted that they would satisfy the original adjudicating authority by producing the documents and seeks remand on this ground. This plea is to be accepted.

In connection with the port services there are several decisions of the Tribunal holding that at the receiver's end, refund cannot be denied on the ground that service provider was not authorized by the port. The decision in the case of GPL Polyfills - 2009 (14) S.T.R. 557 is relevant.

As regards CHA services, the refund has been denied on the ground that service provided by the CHA was not in the nature of CHA services at all. If the invoices issued by the CHA shows the service tax paid under the heading CHA service it would not be appropriate to disallow the credit.

In regards service tax on commission agent located abroad learned counsel submits that the service received is for sales promotion of the goods manufactured by the appellant. There are several decisions taking a view that the service tax paid on Commission Agent service located abroad for sales promotion is admissible for the purpose of Cenvat credit and thereby refund. Therefore, in respect of these services also refund is to be held as admissible.

Since the original adjudicating authority has not verified the documents and has also taken a view that documents were not submitted, the matter is remanded to original adjudicating authority, which shall decide the issue in terms of the above order and decide the eligibility on the basis of documents produced by the appellant.

DECISION:- Appeal disposed off.

Comment: The department has been denying refund of service tax on one pretext or the other. When the services are used for export then refund should be allowed. Now, even the ministry has understood that the refund is not given by the department and they have created a drawback like mechanism for the same. Most of exporters have shifted to the same. Even the ministry seems helpless before the field formation. They are number of objection to deny the refund.

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PJ/Case Laws/ 2012-13/ 1187

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