2017 (7) TMI 446 - AT - Service Tax

Refund claim - Terminal Handling Charges - Bill of Lading charges - denial on the ground that these are not port services - N/N. 41/2007-ST dated 06.10.2017 - Held that - the Bill of Lading Charges and Terminal Handling Charges are received by the appellant for export of goods at port and are covered under port services - refund allowed. Refund claim - Transport Service - denial also on the ground that appellant has failed to provide the documentation with regard to transportation of goods from their factory to ICD as actual service provider has not provided the service to the appellant - Held that - some discrepancy are also point out in the invoices produced by the appellant - the adjudicating authority directed to verify the documents for services received by the appellant and corresponding invoice of service provide and goods transporter to ascertain the fact, whether the invoices produced by the appellant are in respect of transportation of goods from their factory to the port of export or not - matter on remand. Part appeal allowed - part matter on remand.

Summary

Issues:
1. Denial of refund under Notification No.41/2007-ST for Port Services, Terminal Handling Charges, and Transportation of Goods.
2. Denial of refund due to claimed duty drawback.
3. Denial of refund for Terminal Handling Charges and Bill of Lading Charges.
4. Denial of refund claim on Transport Service.

Analysis:

(A) Denial of refund due to claimed duty drawback:
The appellant's refund claim was denied based on the argument that claiming duty drawback on exported goods made them ineligible for a refund on services used in the export process. However, the Tribunal referred to a previous case where it was established that services used for export purposes do not fall under the duty drawback claim. Consequently, the Tribunal held that the appellant is entitled to a refund for services used in the export of goods despite claiming duty drawback.

(B) Denial of refund for Terminal Handling Charges and Bill of Lading Charges:
Regarding the denial of refund for Terminal Handling Charges and Bill of Lading Charges, the Tribunal cited a case where it was clarified that such charges, which are part of port services, are eligible for a refund. The Tribunal emphasized that services paid for at the port fall under port services, entitling the appellant to a refund claim. The Tribunal's decision was based on previous rulings and circulars that supported the appellant's entitlement to a refund for these specific charges related to port services.

(C) Denial of refund claim on Transport Service:
The denial of the refund claim on Transport Service was primarily due to discrepancies in the invoices provided by the appellant and the lack of correlation between invoices issued by the service provider and the goods transporter. The adjudicating authority was directed to verify the documents to determine whether the invoices produced were indeed for the transportation of goods from the factory to the port of export. Once this verification is completed, the refund claims are to be sanctioned accordingly.

In conclusion, the Tribunal ruled in favor of the appellant on all issues, emphasizing their entitlement to a refund for services utilized in the export process, Terminal Handling Charges, Bill of Lading Charges, and Transport Services. The appeal was disposed of with the mentioned directions for the adjudicating authority to verify the relevant documents before sanctioning the refund claims.