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2011 (5) TMI 65 - AT - Service TaxRefund claim - Rule 3 of Export of Services Rules 2005 - an identical issue for the earlier period in the assessee s own case in Final Order No.770/07 dated 13.12.2007 and Final Order No.ST/105 of 2009 dated 5.3.2009 (2009 -TMI - 33500 - CESTAT NEW DELHI) the Bench has given the relief to the assessee holding that the appellant has exported the services despite receiving the amount in Indian rupees - Thus the lower authorities findings that they are rendering the services are not export of services seems to be incorrect - Set aside the impugned order and allow the appeal in favour of assessee.
Issues:
Refund claim under Rule 3 of Export of Services Rules, 2005 - Conversion of currency for export of services. Analysis: The appeal was filed against Order-in-Appeal No.137/GRM/S.T./JPR-I/2007, concerning a refund claim of Rs.5,07,603 under Rule 3 of Export of Services Rules, 2005. The appellants acted as agents for a US corporation, sourcing a contract from Indian Railways and receiving a commission. The Indian Railways paid the US corporation after deducting the commission due to the appellants. The appellants paid service tax on the commission and claimed it as an export of services. However, both lower authorities rejected the claim, citing non-receipt of the amount in convertible currency as per Rule 3(2)(b) of the Rules. The appellant's counsel argued that previous tribunal decisions favored the appellant's position despite receiving payments in Indian rupees. The Tribunal agreed, overturning the lower authorities' decision and allowing the appeal with consequential relief as per the law. The Tribunal held that the services rendered should be considered as export of services, contrary to the lower authorities' findings. This judgment primarily revolves around the interpretation of Rule 3 of Export of Services Rules, 2005, specifically regarding the requirement of receiving payment in convertible currency for export of services. The Tribunal analyzed the appellant's situation where they received payment in Indian rupees for services rendered to a US corporation. The appellant contended that previous tribunal decisions supported their position, emphasizing that despite receiving payments in Indian rupees, the services should be considered as exports. The Tribunal agreed with this argument, setting aside the lower authorities' decision and granting relief to the appellant in line with the law. This analysis underscores the importance of legal interpretations and precedents in determining the eligibility of refund claims under specific rules and regulations. In conclusion, the Tribunal's judgment in this case highlights the significance of consistency in legal interpretations and the application of precedents in similar cases. The decision clarifies the conditions under Rule 3 of Export of Services Rules, 2005, particularly regarding the receipt of payments in convertible currency for export of services. By overturning the lower authorities' decision and granting relief to the appellant based on past tribunal decisions, the Tribunal reinforces the need for a thorough examination of legal provisions and precedents to ensure fair and just outcomes in tax refund claims related to service exports.
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