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2015 (7) TMI 755 - AT - Service TaxDenial of refund claim - Business Auxiliary Service - reverse charge mechanism - Commissioner (Appeals) who allowed partly the refund claim on the premise that they have made payment twice - On merits, he rejected the claim holding that the service of the appellant does not fall under the Export of Services Rules - Held that - in case of marketing of product of their foreign counterpart in India but the service of marketing of product a person who is located outside India has consumed the service outside India. In these circumstances, it is held that the case of the appellant qualifies as export of service as per Rule 3(3)(i) of the Export of Services Rules, 2005. The same view was taken by this Tribunal in Blue Star v. CCE 2014 (12) TMI 25 - CESTAT MUMBAI Although payment has been received in Indian currency on behalf of the service recipient located in India from the service provider and in that case it was held that it is a case of export of service. Therefore, following decision in National Engineering Industries Ltd. (2011 (9) TMI 759 - CESTAT, NEW DELHI) I hold that the appellant complied with the condition of the Export of Service Rules, 2005. Therefore, the appellants are entitled for refund claim. No infirmity in the impugned order in allowing the refund claim in respect of the excess amount paid by them. Therefore, the learned Commissioner (Appeals) has rightly allowed the refund claim - it is the case of Export of Service as per Rules, 2005 therefore, the appellant is entitled to refund claim and the Cross Objections filed by Revenue have no merits - Decided in favour of Revenue.
Issues:
1. Refund claim rejection by Revenue 2. Applicability of Export of Services Rules, 2005 3. Payment received in Indian currency 4. Cross Objections filed by Revenue Analysis: 1. The appellant appealed against the rejection of the refund claim by the Revenue, and the Revenue filed Cross Objections regarding the partial allowance of the claim by the Commissioner (Appeals). The appellant, a commission agent for a foreign counterpart, promotes products in India and procures orders, leading to the initiation of proceedings by the Revenue for Service Tax under Business Auxiliary Service. The Commissioner (Appeals) partially allowed the refund claim, citing double payment by the appellant. However, on merits, the claim was rejected as not falling under the Export of Services Rules, 2005, prompting the appellant's appeal and the Revenue's Cross Objections. 2. The Tribunal analyzed the appellant's activity of marketing foreign products in India and receiving commission, noting allegations of non-compliance with the Export of Services Rules, 2005 due to receiving commission in Indian rupees and service consumption in India. However, the Tribunal held that the service was consumed outside India by a person located abroad, qualifying it as an export of service under Rule 3(3)(i) of the Export of Services Rules, 2005. The Tribunal referenced a previous case to support this view. 3. The issue of payment received in Indian currency was addressed, with the Tribunal citing a previous case where similar circumstances led to a ruling of export of service. The Tribunal held that the appellant's receipt of payment in Indian currency on behalf of the foreign service recipient satisfied the Export of Services Rules, 2005, entitling the appellant to the refund claim. 4. Regarding the Cross Objections filed by Revenue, the Tribunal examined the impugned order's observations on the refund claim discrepancies. The Tribunal found no issue with the Commissioner (Appeals) allowing the refund claim for the excess amount paid by the appellant, dismissing the Cross Objections. Ultimately, the Tribunal concluded that the appellant's case qualified as an export of service under the Rules, 2005, entitling them to the refund claim, while finding no merit in the Revenue's Cross Objections. In summary, the Tribunal upheld the appellant's entitlement to the refund claim based on the export of service classification under the Rules, 2005, and dismissed the Revenue's Cross Objections.
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