2016 (4) TMI 197 - AT - Service Tax

Rejection of refund claim - under Notification No. 41/2007-ST dated 6.10.2007 - Goods exported under claim of drawback under Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 - Appellant contended that drawback did not include the service tax paid on the impugned input services - Held that - there is no doubt that the impugned services were input services. If the contention of the appellant that these services were not included in fixing the all industry rates of drawback was true then there was no need to incorporate the said proviso in Notification No.41/2007-ST as the said proviso would in that case be redundant. There is natural presumption that legislature would not incorporate redundant provisions in law. Further if the said proviso did not affect the eligibility of the exporters for refund under Notification No.41/2007-ST then there was no need for the Govt. to delete the said proviso vide Notification No.33/2008-ST dated 7.12.2008.There is nothing in Notification No.33/2008-ST dated 7.12.2008 which expressly or impliedly gave it retrospective effect. It is thus clear that when the goods were exported under claim of drawback, the impugned refund claims would not be admissible by virtue of proviso (e) to Notification No.41/2007-ST also held by CESTAT in the case of Rajasthan Textile Mills vs. C.C.E., Jaipur - 2014 (8) TMI 853 - CESTAT NEW DELHI . Rejection of refund claim - CHA services - Benefit was denied as the description of goods was not mentioned in the invoice issued by CHA - Held that - the grounds namely services not covered under port service, non-submission of proof of payment of service tax under GTA service and debit note not being prescribed document for this purpose have been analysed in appellant s own case and decided in its favour reported in 2016 (2) TMI 259 - CESTAT NEW DELHI . Regarding CHA services bills of lading and container numbers are clearly mentioned therein and thus it would be quite possible to link as to which goods the CHA bills related to. Therefore this ground for denial of refund in respect of CHA services is not sustainable. - Decided partly in favour of appellant

Summary

Issues involved:
1. Rejection of refund under Notification No.41/2007-ST dated 6.10.2007.
2. Eligibility for refund under the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995.
3. Grounds for rejection of refund claims including services not covered under Port Services, non-submission of proof of payment of service tax on GTA services, and improper invoices.
4. Interpretation of relevant provisions and notifications affecting the eligibility for refund.

Analysis:

1. The appeals were filed against orders rejecting refunds under Notification No.41/2007-ST. The specific details of the rejected refunds for M/s Bharat Art & Crafts, M/s Shivam Exports, and M/s Bothra International were outlined, including the amounts rejected, periods involved, and grounds for rejection. The grounds included issues like exports under claim of Drawback, non-coverage under Port Services, and non-submission of proof of payment of service tax on GTA services.

2. Regarding M/s Bharat Art & Crafts and M/s Bothra International, the contention was that the drawback did not include service tax paid on input services as per the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995. The Rule 3(2)(ea) mandates considering the average amount of tax paid on taxable services used as input services. The Tribunal clarified that the services in question were indeed input services, and the proviso in Notification No.41/2007-ST indicated that goods must be exported without availing drawback of service tax on specified services. The Tribunal referred to a previous case to support the decision that the refund claims were inadmissible under the proviso.

3. In the case of Shivam Exports, certain grounds for denial of refund were analyzed. The Tribunal found that services not covered under Port Services, non-submission of proof of payment of service tax on GTA services, and the issue of proper invoices had already been decided in the appellant's favor in a previous order. Regarding CHA services, the benefit was denied due to the description of goods not being mentioned in the invoices issued by CHA. However, upon reviewing the representative invoices, the Tribunal found the information sufficient to link the services to the goods, leading to the conclusion that the denial of refund on this ground was not sustainable.

4. Consequently, the Tribunal dismissed the appeals of Bothra International and Bharat Art & Crafts while allowing the appeal of Shivam Exports based on the analysis of the grounds for rejection and the interpretation of relevant provisions and notifications affecting the eligibility for refunds under the specified rules and notifications.

This detailed analysis of the judgment provides a comprehensive understanding of the issues involved and the Tribunal's reasoning behind the decisions made in each case.