2017 (11) TMI 609 - AT - Service Tax

Refund claim - consumption of services in the course of export mainly port services - N/N. 41/2007-S.T. (as amended) - which is the date of export order or till which stage the services received by the appellant are allowable for the purpose of refund under the N/N. 41/2007-S.T. (as amended)? - Held that - all the services received till the goods reached the gateway, port or the port of export and/or loaded on the ship or aircraft for the purpose of export till such time, are allowable for exemption/refund under the provisions of N/N. 41/2007-ST (as amended) - refund allowed - appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
Refund claim under Notification No. 41/2007-S.T. for port services in the course of export.

Analysis:
The appellant, a manufacturer of laminated sheets who also exports the same, filed appeals questioning the rejection of their refund claim under Notification No. 41/2007-S.T. for services consumed during export, particularly port services. The core issue was whether services like handling, stevedoring, loading, unloading, tug hire, and labor arrangement provided by the shipping line at the port of export fall under port services, and if refund is permissible post issuance of the let export order at the ICD and receipt of additional services until loading at the Gateway port.

The appellant's counsel cited a previous ruling in their favor (ST Appeal No. 1287/2011-SM) where a coordinate Bench of the Tribunal allowed the refund claim for similar services falling within the scope of port services. The Tribunal directed the refund in that case, establishing a precedent for the current appeal.

The remaining issue revolved around determining the date of export order and the stage until which services received by the appellant are eligible for refund under the amended Notification No. 41/2007-S.T. The Commissioner rejected part of the claim citing limitation, considering the let export order at the ICD as the date of export. However, the appellant argued that the goods had not reached the port of export or the gateway port at that stage.

The Tribunal, after evaluating the arguments, referred to Clause (f) in Notification No. 17/2009-S.T. which mandated filing refund claims within one year from the date of export. The explanation clarified that the date of export is deemed to be when the customs officer permits clearance and loading for export under Section 51 of the Customs Act, 1962. Consequently, the Tribunal held that services received until the goods reached the gateway port or port of export and were loaded for exportation are eligible for exemption/refund under Notification No. 41/2007-S.T. The appeals were allowed, setting aside the Orders-in-Appeal and instructing the Adjudicating Authority to process the refund within 45 days along with applicable interest.