2010 (12) TMI 299 - AT - Service Tax

Refund of the service tax - Export of goods - As per Notification No. 41/2007-Service Tax, the assessee cannot claim the refund of Service Tax paid on the services which are being used for the purpose of export of goods by the merchant exporter - The exporter (who has availed the service for export) is entitled to claim the refund of service tax paid by them and not the manufacturer of the goods - As per the case of CCE, Chandigarh v. Indian Overseas Corporation ,the Hon ble High Court of H.P. has also taken the same view that the exporter is entitled to claim rebate, not the manufacturer - Held that the assessee is not entitled to take refund of service tax paid on the services availed by the exporter for export of the goods - Hence, the appeals filed by the assessee are rejected and the appeals filed by the Revenue are allowed.

Summary

Issues:
Refund of service tax paid on services used for export by manufacturer vs. exporter under Notification No. 41/2007-Service Tax.

Analysis:
The judgment involves twelve appeals, eight by the Revenue and four by the assessee, all concerning a common issue. Despite multiple opportunities, the assessee did not appear, indicating disinterest in pursuing the case. The facts revolve around the assessee, engaged in manufacturing DOC, exporting goods through a merchant-exporter who availed taxable services during export. The dispute arose when the assessee filed refund claims for service tax paid on these services, which were rejected by the original authority citing non-compliance with Notification conditions.

The learned DR argued that Notification No. 41/2007-Service Tax specifies that only the exporter, not the manufacturer, can claim a refund for service tax paid on export-related services. The Tribunal carefully analyzed the Notification and referred to a relevant case law, CCE, Chandigarh v. Indian Overseas Corporation, where the High Court held that the exporter is entitled to claim the rebate, not the manufacturer. Drawing from this precedent, the Tribunal concluded that the exemption under Notification No. 41/2007 is exclusively available to the exporter, not the manufacturer.

Based on the above analysis, the Tribunal held that the assessee is not entitled to a refund of service tax paid on services used for export by the exporter. Consequently, the appeals filed by the assessee were rejected, while those by the Revenue were allowed. The judgment disposed of all twelve appeals in this manner, emphasizing the importance of compliance with Notification provisions and legal precedents in determining refund eligibility.

*(Dictated in Court)*