2010 (5) TMI 209 - AT - Service Tax

Notification No. 41/2007-ST dated 6.10.2007- The appellant filed a refund claim of Rs.2,72,727/- claiming the benefit of exemption Notification No. 41/2007-ST dated 6.10.2007. The Asst. Commissioner rejected the refund claim. the Commissioner (Appeals) also rejected their refund claim. Held that- the refund claim was rejected for non-production of the evidence asked by the Commissioner (Appeals) during the course of personal hearing. In that circumstance it would be appropriate in the interest of justice to remand back the matter to the original adjudicating authority to verify the documents again.

Summary

Issues:
- Rejection of refund claim under Notification No. 41/2007-ST for iron and steel products manufacturer.
- Denial of refund for cargo handling services and Clearing and Forwarding services.
- Rejection based on incomplete documentation and lack of evidence of tax deposition by service provider.

Analysis:
The appellant, a manufacturer of iron and steel products, filed a refund claim of Rs.2,72,727 under Notification No. 41/2007-ST, seeking exemption for certain taxable services used for export. The Asst. Commissioner rejected a major portion of the claim. The Commissioner (Appeals) also upheld the rejection, leading to the appellant's appeal. Despite the absence of the appellant during the final hearing, the Tribunal considered their written communication requesting a decision based on their submissions.

The Revenue argued that the refund claim for cargo handling and Clearing and Forwarding services was not permissible under Notification No. 41/2007-ST. The Tribunal noted the grounds for rejection by the original authority, citing invalid documents for Port service and specific amounts for cargo handling and Clearing and Forwarding services. The lower appellate authority did not accept the appellant's explanation that cargo handling services were mistakenly included, emphasizing that the refund was sanctioned based on document contents not covered by the Notification.

The Tribunal highlighted the appellant's failure to provide evidence of tax deposition by the service provider during the personal hearing. Instead of the required evidence, the appellant submitted a circular clarifying the necessity of complete invoices for refund claims under the Notification. The Tribunal observed that the refund claim was rejected due to non-production of requested evidence, prompting a remand to the original adjudicating authority for verification of documents to determine the appellant's entitlement to the refund under Notification No. 41/2007-ST.

In the interest of justice, the Tribunal remanded the matter to the original authority for a thorough review based on complete documentation, emphasizing the importance of meeting statutory requirements for refund claims. The decision to remand back the case aimed to ensure a fair assessment of the appellant's eligibility for the refund under the relevant Notification.