2019 (6) TMI 207 - AT - Service Tax

100% EOU - Rebate claim/Refund of service tax paid - service tax paid on input services used in export of output services under N/N. 12/2005-ST dt. 19/04/2005 - HELD THAT - The requisite declaration as required under condition of Notification has been filed on 31/05/2005 and revised on 16/06/2005 on account of some inadvertent error and the same has been placed on record. In the impugned order, the Commissioner(Appeals) has laid importance on procedural requirements without appreciating the fact that the input services have been received by the appellant and used for providing output services, which were exported out of India and thus fulfilling the substantive requirement under Export of Service Rule and the Notification. Time limitation - period October 2005 to March 2006 - HELD THAT - Rebate claim was rejected on time bar as the same has been filed beyond one year as prescribed under Section 11B of Central Excise Act, 1944; but this time limit of Section 11B is not applicable in the present case because the said notification does not provide for any time limit within which the rebate claim should have been filed and the same. The rejection of rebate claims is not sustainable in law - appeal allowed - decided in favor of appellant.

Summary

Issues:
Rejection of rebate claims by Commissioner(Appeals) on various grounds including procedural lapses, time bar, and discrepancies in documentation.

Analysis:
The appellant, a public limited company engaged in Business Process Outsourcing, filed rebate claims for service tax paid on input services used in exporting output services under Notification No.12/2005-ST. The rebate claims were rejected by the original authority based on several grounds, including missing service tax registration numbers on export invoices, discrepancies in input service invoices, and failure to produce required declarations. The rejection for the period October 2005 to March 2006 was also based on time bar under Section 11B of the Central Excise Act, 1944.

The appellant argued that the rejection was unlawful as all conditions under Rule 3 of Export of Service Rules, 2005 had been met. They cited judicial precedents to support their claim that late filing of declarations should not deprive them of benefits under the notification. They also highlighted that the time limit under Section 11B did not apply as the notification did not specify a time frame for filing rebate claims.

The Tribunal, after considering submissions from both sides and reviewing relevant case laws, found that the required declarations had been filed, albeit with a minor error corrected later. They emphasized that procedural lapses should not hinder the substantive benefit entitled to the appellant. The Tribunal also noted that the time limit under Section 11B did not apply in this case due to the absence of a specified time frame in the notification. Relying on previous decisions, the Tribunal concluded that the rejection of rebate claims was not legally sustainable and overturned the impugned order, allowing the appeal with consequential relief of interest as requested by the appellant.

In conclusion, the Tribunal allowed the appeal, setting aside the rejection of rebate claims and granting consequential relief to the appellant, emphasizing the importance of fulfilling substantive requirements over procedural lapses and clarifying the applicability of time limits in such cases.