2015 (3) TMI 831 - AT - Service Tax

Denial of refund claim - Business Auxiliary Services - no ground to pay service tax as the service rendered by them would fall under the category of Export of Service' and the service tax paid by them was under protest - Held that - The issue is squarely covered by the majority decision of the Tribunal in the case of Paul Merchants Ltd. decision 2012 (12) TMI 424 - CESTAT, DELHI (LB) wherein an identical issue involving the very same principal, M/s. Western Union Money Network Ltd. for money transfer to persons located in one country to another person located in another country was considered. In the impugned order, the ratio has been recorded by the first appellate authority at paragraph 16. Secondly, we find that the grounds of appeal, as raised by the department, is relying upon the stay order passed by the bench in the case of Weizmann Forex Ltd. The final order of the Tribunal in the case of Paul Merchants Ltd. is the law settled as the stay orders are always on a prima facie view being taken. Thirdly, in our considered view, the judgment of the Tribunal in the Paul Merchants case has been followed in various other decisions and a view has been taken in favour of the assessee. - impugned order is correct, legal and does not suffer from any infirmity - Decided against Revenue.

Summary

Issues:
1. Appeal against Order-in-Appeal allowing refund to the respondent.
2. Whether the service provided falls under the category of "Export of Service."
3. Challenge to the reliance on the judgment in the case of Paul Merchants Ltd.
4. Comparison with the decision in the case of Weizmann Forex Ltd.

Analysis:
1. The appeal was filed against Order-in-Appeal No: 101/BPS/MUM/2013 allowing a refund to the respondent, which was set aside by the Commissioner of Central Excise & Service Tax (Appeals-IV), Mumbai-I. The Revenue challenged this decision.

2. The main issue was whether the service provided by the respondent, as per an agreement with Western Union Finance Services Inc., USA, qualified as "Export of Service" and thus exempt from service tax. The respondent claimed a refund on the grounds that the service fell under this category and the service tax was paid under protest. The first appellate authority relied on the Tribunal's decision in the case of Paul Merchants Ltd. to allow the refund.

3. The Revenue contested the reliance on the Paul Merchants Ltd. judgment, arguing that it was challenged and not a settled law. However, the Tribunal found no merit in the Revenue's grounds of appeal. The Tribunal held that the issue was already decided in the Paul Merchants Ltd. case, involving the same principal and service type. The Tribunal emphasized that stay orders, like the one in the Weizmann Forex Ltd. case, are based on a prima facie view and do not establish final legal precedent.

4. The Tribunal concluded that the impugned order was legally sound and upheld it, rejecting the Revenue's appeal. The decision was based on the established law from the Paul Merchants Ltd. case and the consistent view taken in favor of the assessee in similar cases. The judgment highlighted the importance of following precedent and established legal principles in deciding such matters.

This detailed analysis of the judgment from the Appellate Tribunal CESTAT MUMBAI demonstrates a thorough examination of the issues involved and the legal reasoning behind the decision.