2013 (11) TMI 1402 - AT - Service Tax

Refund of service tax - Merchant Exporter - refund of service tax paid by them in respect of 13000 MTs of sugar exported by them - Held that - Foreign Trade Policy is not a mandatory requirement for the purpose of third party exports. Foreign Trade Policy requires an exporter to be identified for the purpose of determination of eligibility for export benefits and for this purpose, the third party exporter is required to be mentioned in all the documents. If the Shipping Bills do not contain the name of third party exporter, the third party exporter who is a Merchant Exporter would not be the exporter in the eyes of law. Notification No. 17/2009-S.T. dated 7.7.2009, amended subsequently under which refund has been made. According to this notification, exemption for the taxable service which is extended in the form of refund is available in respect of taxable service received by exporter of the goods and used for export of the goods. There is no definition in the notification or in the Central Excise Act. Since the refund is for the export of goods, it would be appropriate to take the definition of exporter in the Customs Act for this purpose. In this case, the respondent has fulfilled all the conditions since name of the respondent has figured in the Shipping Bills; the goods have been exported. There is no dispute in this aspect and service has been used for export of goods and service tax has been suffered by manufacturer - Decided against Revenue.

Summary

Issues involved:
Determining eligibility for refund of service tax paid by the respondent in relation to exported sugar, specifically focusing on the real exporter for 7800 MTs of sugar, where the name of a different entity appeared on certain documents.

Analysis:
The main issue in this case revolved around the eligibility of the respondent for a service tax refund on sugar exports. The Revenue contended that for 7800 MTs of sugar, the real exporter was a Merchant Exporter named M/s INTER EXPORTS, as indicated by additional invoices and Bills of Lading. The Tribunal considered all submissions and documents presented during the hearing to make a final decision.

During the hearing, queries were raised regarding the Shipping Bills, invoices of CHA, and the export invoices. It was confirmed that all Shipping Bills and CHA invoices were solely in the name of the respondent, M/s Sudalagunta Sugars Ltd. The export invoices indicated the respondent as the exporter for direct exports and mentioned M/s INTEREXPORTS for third-party exports.

The Tribunal noted that no refund had been given to the respondent based on the order of the Commissioner (Appeals). Subsequently, the respondent filed a fresh refund claim, which was still pending. The dispute centered on the fact that although all Shipping Bills were in the respondent's name, the Commercial Invoice was raised by M/s INTEREXPORTS, who also received payments and was listed as the exporter in Bills of Lading.

The Tribunal analyzed the Foreign Trade Policy cited by the Revenue, which required the declaration of third-party exports in export documents. However, the Tribunal clarified that this policy did not make it mandatory for third-party exports. It emphasized that the Customs Act defined an exporter as the person whose name appeared in the Shipping Bills, aligning with the respondent in this case.

Referring to a Tribunal decision cited by the Revenue, the Tribunal distinguished the present case from the precedent, emphasizing that the conditions of Notification No. 17/2009-S.T. were met by the respondent. As the respondent fulfilled all requirements for the exemption and refund under the notification, including being the exporter listed in Shipping Bills and using the service for export, the Tribunal rejected the Revenue's appeal, finding no merit in their arguments.

In conclusion, the Tribunal dismissed the appeal filed by the Revenue, upholding the eligibility of the respondent for the service tax refund on exported sugar, as the respondent met all necessary conditions under the relevant notification and statutory provisions.