2021 (7) TMI 379 - AT - Service Tax

Refund of service tax - export of goods made under Bills of Export - denial on the ground that the conditions as prescribed in Clause (i) of Paragraph 3 of the Notification No.41/2012-ST dated 29.06.2012 has not been complied with - non-submission of certificate of the Chartered Accountant as prescribed in sub-clauses (A) (B) - HELD THAT - The learned Deputy Commissioner of Service Tax has passed a detailed order incorporating the shipping Bill number, date, name of the service provider, invoice number, date etc.etc.. In short he has gone through all the documents and has discussed the conditions of the Notification or eligibility of the refund claim and after making a point-wise observation, has finally sanctioned the refund - The learned Commissioner(Appeals) could have called for the copy of the Cross Objection filed by the assessee as well as copy of the Chartered Accountant s Certificate. This cannot be the ground to reject the assessee s claim of refund. It can be seen that there is no dispute as to the fact that the goods were exported by the appellant assessee. Once it is not in dispute that the services are specified for refund purpose, and since Service Tax was actually paid on specified services pertaining to export activity, in terms of the broad scheme of refund under Notification No. 41/2012-ST as amended with clarifications, refund must be granted to the exporter. It is my considered view that the order passed by the learned Commissioner(Appeals) cannot be sustained as substantive benefit should not be denied to an assessee if conditions are fulfilled. The impugned order is set aside and the order passed by the learned Adjudicating authority is upheld - Appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Appeal against denial of refund of Service Tax on specified services for export of goods.
2. Dispute regarding submission of Chartered Accountant's Certificate and Cross Objection.
3. Interpretation of conditions for refund under Notification No. 41/2012-ST.
4. Consideration of substantive benefit to the assessee in granting refund.

Analysis:
1. The case involves an appeal against the denial of refund of Service Tax on specified services used for the export of goods. The Deputy Commissioner initially allowed the exemption of a certain amount as a refund, but the Department filed an appeal citing non-fulfillment of conditions and lack of Chartered Accountant's Certificate. The Commissioner(Appeals) modified the decision in favor of the Department due to the absence of a Cross Objection and the missing Certificate, leading to the current appeal before the Tribunal.

2. The appellant, represented by a Chartered Accountant, argued that the refund claim met the prescribed conditions under Notification No. 41/2012-ST. They claimed to have submitted a Cross Objection against the Department's appeal, emphasizing that the Certificate was indeed filed. The Authorized Representative for the Revenue supported the lower appellate authority's decision based on the grounds raised by the Department.

3. Upon review, the Tribunal found that the Deputy Commissioner had thoroughly examined the documents and conditions for the refund, ultimately sanctioning it. The Commissioner(Appeals) upheld the Department's appeal primarily due to the absence of a Cross Objection and the Certificate. The Tribunal criticized this reasoning, stating that the lack of these documents should not be a basis for rejecting a valid refund claim under the notification's scheme.

4. The Tribunal emphasized that if the exported goods and specified services for refund were not in dispute, and the Service Tax was paid accordingly, the exporter should be granted the refund as per the scheme's intent to support Indian exporters. Denying refunds on technical grounds defeats the purpose of such schemes and subjects exporters to unnecessary litigation. Consequently, the Tribunal set aside the lower appellate authority's decision and upheld the Deputy Commissioner's order, allowing the appeal with any consequential relief.

In conclusion, the Tribunal ruled in favor of the appellant, emphasizing the importance of granting substantive benefits to exporters fulfilling the refund conditions under the relevant notification.