2018 (3) TMI 1742 - AT - Service Tax

Rebate claim - appellant filed the required declaration under Para 3.1 of the said notification belatedly at the time of processing of their rebate claim - Rule 5 of Export of Services Rules 2005 read with Notification No 12/2005-ST dated 19/04/2005 - Held that - The issue herein is squarely covered in favour of the appellant by the ruling of Division Bench of this Tribunal in the case of Commissioner of Service Tax Delhi Versus Convergys India Pvt. Ltd. 2009 (5) TMI 50 - CESTAT NEW DELHI where it was held that non-fulfilment of the procedure cannot lead to denial of the benefit under the beneficial legislation providing for export benefits - rebate allowed - appeal allowed - decided in favor of appellant.

Summary

Issues:
Entitlement to rebate under Rule 5 of Export of Services Rules, 2005 read with Notification No 12/2005-ST dated 19/04/2005 for belatedly filing the required declaration under Para 3.1 of the said notification.

Analysis:
The appellant, engaged in Business Process Outsourcing (BPO) services, filed a refund claim for rebate of Service Tax paid on input services used in providing exported output services. The Show Cause Notice alleged non-compliance with the procedure under Notification No. 12/2005-ST by not filing a declaration prior to the date of export as required under Para 3.1 of the said Notification. The Notice also disputed the eligibility of certain input services for credit and the adequacy of duty paying documents. The Order-in-Original rejected the refund claim, which was upheld by the ld. Commissioner (Appeals) citing strict compliance with the notification's conditions as essential for availing benefits.

The appellant contended that the filing of the declaration before export was procedural and did not require prior permission from the Judicial Authority. Relying on a Division Bench ruling, the appellant argued that late filing of the declaration should not deny substantial benefits, especially in cases of export, where a liberal view should be taken. The Division Bench also clarified that the eligibility for credit on inputs and tax paid on services is not dependent on whether the services are exported or provided domestically. The appellant sought relief based on these arguments.

The Tribunal, after considering the contentions, found the issue in favor of the appellant based on the precedent set by the Division Bench in a similar case. The impugned order was set aside, and the matter was remanded back to the Adjudicating Authority for recalculating the refund claim in line with the Division Bench's ruling. The Tribunal emphasized the importance of following the precedent in determining the appellant's entitlement to rebate under the relevant rules and notification.

This detailed analysis of the judgment highlights the key legal issues, arguments presented, and the Tribunal's decision based on the interpretation of relevant laws and precedents.