2012 (8) TMI 22 - AT - Service Tax

Refund claims - under Notification No. 41/2007-ST - refund of service tax paid on GTA services in respect of transport of the impugned goods directly from the place of removal to the port from where the same were exported Held that - On the date of filing the claims, the requirement of the notification has been satisfied and the service taxes paid in respect of GTA services used for transport of the impugned goods for export from the place of removal to the port have become refundable - appeals are allowed

Summary

Issues: Refund of service tax on GTA services for transport of export goods directly from the place of removal to the port prior to and after the amendment of Notification No. 41/2007-ST.

Analysis:
The appellant-exporter filed refund claims for service tax paid on GTA services for transporting goods directly from the place of removal to the port for exports. The claims were made under Notification No. 41/2007-ST before the amendment on 19.2.2008, which allowed refunds for transport from ICD to the port. However, the claims were filed after the amendment date, leading to their rejection based on the earlier restriction. The appellant argued that since the refund was admissible when the claims were filed, they should be allowed to prevent burdening export goods with domestic taxes, aligning with the government's policy to enhance competitiveness in foreign markets.

The department contended that the refund was not admissible at the time of export, hence should not be granted. The Tribunal noted that the exemption notification aimed to relieve export goods from service tax burden to boost competitiveness in foreign markets. Referring to a previous case, it was emphasized that if refund claims meet the requirements of amended rules when filed post-amendment, they should not be rejected. The Tribunal also considered the extension of the time limit for filing refund claims and circulars issued by the Board to process pending claims under amended provisions, supporting the objective of encouraging exports and avoiding domestic tax burdens on export goods.

In line with the cited decisions and government policy objectives, the Tribunal ruled in favor of the appellant, setting aside the impugned order and allowing the appeals for refund sanctioning, if otherwise due. This decision was made to ensure that service taxes paid for GTA services used in transporting goods from the place of removal to the port for export became refundable as per the requirements of the notification at the time of filing the claims.