2010 (2) TMI 969 - Commissioner - Service Tax

Summary

Issues involved: Refund claims for input services related to the exporting of iron ore, calibrated iron ore, and lump; rejection of refund claims based on lack of supporting documents and nexus with exported goods.

Issue 1 - Refund claims rejection for April to June 2008:
The Appellants, engaged in exporting iron ore, filed refund claims for input services but were rejected due to lack of supporting documents like lorry receipts, absence of export invoice and shipping bill details, and failure to meet conditions for machine hire charges. The rejection was based on the absence of Service Tax registration numbers on invoices. Appellants argued that the rejection was based on assumptions and legal errors, citing relevant case laws. They contended that their claims were complete and that the co-relation of documents was not feasible due to logistical reasons. They also highlighted that certain charges were taxable and refundable. The Appellant's representative argued for the refund during the Personal Hearing.

Issue 2 - Refund claims rejection for July to September 2008:
The second refund claim was rejected citing similar reasons of lack of nexus between input services and exports, specifically mentioning the absence of ICD/port/airport details in lorry receipts and the failure to provide documentary evidence for correlation. The Appellants challenged this rejection, emphasizing that the services were specified in the Notification and that they had submitted transport bills with the claim. They argued that as per the government's policy, the refund should be granted as an export incentive.

Findings:
After reviewing the case records, submissions, and arguments, the Commissioner found that the rejection of refund claims was not justified. For the first appeal, the Commissioner agreed that the Appellants were entitled to the refund from May 16, 2008, onwards and that the reasons for rejection were not valid. Regarding the second appeal, the Commissioner noted that while there were minor technical lapses, the substantial aspect of export was established. The Commissioner agreed with the contention that it was not practically feasible to have certain details like export invoice numbers and shipping bill numbers for such large quantities of goods. The Commissioner upheld the Order-in-Original for the period up to May 15, 2008, and allowed the appeal for the remaining period from May 16, 2008, with the consequential benefit of refund to the Appellants. The Orders-in-Original passed by the Deputy Commissioner and Assistant Commissioner were set aside, granting the appeal with consequential benefit.