2018 (2) TMI 1253 - AT - Service Tax

Refund claim - the service provided appears to be outside the provisions of Rule 6A of Service Tax Rules, 1994, hence the refund claim filed by the respondents sought to be rejected - Held that - in this case the respondent is located in India and providing services to the customers of their principal located outside India on behalf of their principal in India - as the respondent service in India to the customers of their principal located outside India, therefore, the said services are provided by the respondent on behalf of the principal outside India who is located outside India, are the export of service. Appeal dismissed - decided against Revenue.

Summary

Issues:
1. Refund claim rejection based on service provision location.
2. Interpretation of export of service rules.
3. Application of precedent in similar cases.

Analysis:
The appeal before the Appellate Tribunal CESTAT Ahmedabad involved the rejection of refund claims by the Revenue due to the location of service provision. The respondent had executed an agreement with a company in the USA, with the Revenue contending that services provided were not export of service as they were delivered to an Indian recipient. The adjudicating authority partially allowed the refund claim, leading to an appeal by the Revenue against the decision of the ld. Commissioner (Appeals).

During the proceedings, the Revenue argued that the services provided by the respondent did not qualify as export of service since they were rendered to an Indian recipient. Conversely, the respondent's counsel cited a precedent set by the Tribunal in the case of Blue Star Limited Vs. CST, Mumbai, asserting that services had indeed been exported. The Tribunal analyzed the situation and referenced the aforementioned case, emphasizing that services provided by the respondent in India to customers of their principal outside India constituted export of service under Rule 3(3) of the Export of Taxable Service Rules, 2005.

Ultimately, the Tribunal upheld the decision of the ld. Commissioner (Appeals), dismissing the appeals filed by the Revenue. The judgment highlighted that since the respondent's services were provided in India to customers of their principal located outside India, they qualified as export of service. The ruling aligned with the precedent established in the case of Blue Star Limited, affirming the respondent's entitlement to the refund claim. The judgment concluded with the dismissal of the Revenue's appeals, affirming the validity of the refund claims sanctioned to the respondent.