2015 (11) TMI 224 - AT - Service Tax

Denial of refund claim - Notification 6/2010-ST dated 27/02/2010 - Export of service - Held that - onsite services rendered by the appellants abroad would qualify for being termed as export of service. - Appellant-assessee had exported the services, received the payment in convertible foreign exchange. We find that, on the factual matrix, the refund is liable to be sanctioned to the appellant-assessee as this bench, in the appellant-assessee s own case 2013 (4) TMI 104 - CESTAT MUMBAI - In view of the affirmation of the Tribunal s judgment by the Hon ble High Court 2014 (9) TMI 567 - BOMBAY HIGH COURT , we find that the impugned order to the extent it rejects the refund claim filed by the appellant-assessee is incorrect and unsustainable. The same is set aside - Decided in favour of assessee.

Summary

Issues:
Refund claims rejection post-February 2010 regarding export of service for taxable services and information technology software services.

Analysis:
The case involved appeals by both the Revenue and the assessee against the Order-in-Appeal. The issue revolved around refund claims post-February 2010, with the appellant engaged in providing taxable services and exporting information technology software services. The lower authorities partially allowed refund claims, leading to appeals. The Revenue contended that on-site services by the appellant's foreign subsidiary should not be treated as exports, affecting refund calculations.

The senior counsel argued that post-February 2010, refund claims meeting the condition of payment in convertible foreign exchange should be sanctioned. The Tribunal's previous judgment supported this view, upheld by the High Court. The Special Counsel for Revenue reiterated the lower authorities' findings.

The Tribunal examined submissions and records, noting cross-objections supporting the impugned orders. The key issue post-February 2010 was the amendment to Export of Service Rules, necessitating consideration of Rule 3 amendments. Refund claims rejected post-February 2010 were in question, with no dispute over services exported and payment received in foreign exchange.

The Tribunal referenced its previous judgment, emphasizing that post-February 2010, receipt of payment in foreign exchange constituted export of service, irrespective of service location. The High Court affirmed this interpretation, dismissing Revenue's appeal. Consequently, the Tribunal allowed the assessee's appeal, rejecting Revenue's appeals as lacking merit.

In conclusion, the assessee's appeal was allowed with consequential relief, while Revenue's appeals were dismissed. The impugned order rejecting the refund claim was deemed incorrect and set aside, providing relief to the assessee. The judgment affirmed the eligibility of on-site services as exports, in line with legal provisions and previous decisions.