2016 (9) TMI 897 - AT - Service Tax

SEZ unit - Refund claim - Notification No. 40/2012-ST dated 20/6/2012 - period involved is October 2011 to December 2012 - service tax paid on the services provided to them for authorized operations as per various notifications issued from time to time - provisional services rendered by Chartered Accountant as well as those of training of employees - Held that - I have perused invoices issued in respect of the CA services. There are three invoices issued to M/s Cummins India Ltd., I find that all the three invoices are issued to M/s Cummins India Ltd. However, it is clearly mentioned that it is to the account of M/s Cummins Technologies India Pvt. Ltd., the appellant in the present case. In as much as these services have been rendered to the appellant s SEZ unit as well as are covered in the approved list of services, I find no justification for denial of the refund. Refund claim - invoices issued by CHA do not show the service tax paid by the service providers engaged by them - Held that - I find that the claim of refund of service tax made under such invoices by the CHA has been denied by the authorities below for the reason that the invoices issued by the service provider, i.e. CHA, do not indicate the full amount of service tax. However, it is evident that all the service providers engaged by the CHA have all render service on account of the appellant SEZ unit. The issue is no more res-integra and have come up before the Tribunal in the past and in such cases the refund stands allowed. Refund claim - training of employees - Held that - I have seen the three invoices. All three invoices are in favour of appellant and indicate clearly the service tax amounts. Since Commercial & Training and Coaching Services approved for authorized operations, I find no justifiable reason to reject the refund. - Decided in favour of appellant

Summary

Issues:
Refund claim under Notification No. 40/2012-ST for services consumed by SEZ unit; Rejection of refund claim for CHA services, professional services, and training services; Interpretation of SEZ Act, 2005 provisions overriding other Acts; Disallowance of refund due to lack of service tax details on invoices; Applicability of approved services list by Development Commissioner; Legal arguments and reliance on case laws for refund claim; Disagreement on refund denial based on invoices; Tribunal's past decisions on similar refund claims.

Analysis:
The judgment revolves around a refund claim filed by a SEZ unit under Notification No. 40/2012-ST for services consumed within the SEZ. The dispute arose when the Original Authority rejected a part of the claim amounting to ?3,31,549 for various services. The appellant contended that SEZ Act, 2005 provisions exempt service tax for services used in authorized operations, overriding other Acts. They argued that the services were utilized by the SEZ unit and should not be restricted by the Revenue. The rejection included CHA services, professional services, and training services, citing reasons like lack of service tax details on invoices and services not being in the approved list.

The Tribunal analyzed the SEZ Act, 2005 provisions and Notification No. 40/2012-ST, emphasizing that services consumed within the SEZ are eligible for refund, subject to approval by the Development Commissioner. The Tribunal found that the services in dispute were approved by the Development Commissioner in a list dated 23/4/2009, including CHA services and professional services by a Chartered Accountant. Refund denial for these services was deemed unjustified. The Tribunal reviewed invoices for the services and noted that they were rendered to the SEZ unit and covered in the approved list, justifying the refund.

Regarding CHA services, the Tribunal examined invoices issued by the CHA and service providers, finding that service tax details were present in accompanying invoices despite not being on the CHA's invoices. Citing past Tribunal decisions, the Tribunal held that the refund should be allowed based on the service tax payment evidence by the service providers. The Tribunal also addressed the rejection of the claim for training services, finding no valid reason for denial as the services were approved for authorized operations.

Ultimately, the Tribunal set aside the impugned order, allowing the appeal except for the uncontested amount, providing consequential relief to the appellant. The judgment reaffirmed the precedence of SEZ Act provisions and approved services list, ensuring refunds for services consumed within the SEZ. The legal arguments, case law references, and past Tribunal decisions played a crucial role in establishing the appellant's entitlement to the refund.