2013 (9) TMI 815 - AT - Service Tax

Refund of service tax - export of goods - Proof of export - Benefit of Notification - Conditions of notifications not fulfilled - Held that - movement to Villupuram railway goods yard and then from there to the port would be treated as only transshipment and cannot be held against the assessees for denying refund. As regards non-fulfilment of the condition relating to specific mention of details of exporters invoices, in the lorry receipts and the corresponding shipping bills, I find that the assessees have attempted to correlate the export goods with the lorry receipts and the shipping bills in the form of detailed tabular chart containing details of ARE-1, date, quantity of sugar, shipping bill no. and date etc. I am therefore of the view the attempt of correlation should be carried out by the department and for this purpose, I set aside the impugned order and remit the case to the adjudicating authority who shall carry out the exercise of reconciliation so as to establish that the assessees had fulfilled condition no. (iii) of Notification No. 41/2007 as amended, after holding that the assessees have not contravened conditions of the notification - Decided in favour of assessee.

Summary

Issues:
- Rejection of refund claims based on non-fulfillment of conditions stipulated under Notifications
- Transportation of exported goods and specific mention of details of exporters' invoices in lorry receipts and shipping bills

Analysis:
The judgment by the Appellate Tribunal CESTAT CHENNAI involved the rejection of refund claims totaling Rs. 3,01,002/- and Rs. 3,30,940/- for the period from 1st Apr. 2008 to 30th Sept. 2008 by manufacturers of sugar. The rejection was on the grounds of not fulfilling conditions stipulated under Notification No. 41/2007-S.T., dated 6-10-2010 as amended by Notification No. 3/2008-S.T., dated 19-2-2008. The conditions required for claiming a refund were related to the transportation of goods and the specific mention of exporters' invoice details in the lorry receipts and shipping bills.

Regarding the transportation issue, the department argued that the export goods were not directly transported from the place of removal to the port as required by the notification. However, the Tribunal disagreed, stating that the movement to Villupuram railway goods yard and then to the port constituted transshipment, not a violation of the conditions for refund. On the matter of specific mention of invoice details in the documents, the assessees had provided a detailed tabular chart correlating export goods with lorry receipts and shipping bills. The Tribunal found this attempt at correlation satisfactory and directed the department to carry out the reconciliation exercise to establish compliance with the conditions.

Consequently, the Tribunal set aside the impugned order and remitted the case to the adjudicating authority for further examination. The authority was instructed to conduct the reconciliation exercise to confirm that the assessees had fulfilled the conditions of the notification. The Tribunal emphasized the need for a fair hearing and instructed fresh orders to be passed after providing a reasonable opportunity for the assessees to present their case. Ultimately, the appeals were allowed by way of remand, ensuring a thorough review of the refund claims in light of the notification conditions.