2018 (2) TMI 152 - AT - Service Tax

Refund claim - time limitation - whether the time period for filing refund under Rule 5 i.e. one year from the date of invoice or from the receipt of convertible foreign exchange against the export of service? - Held that - From the plain reading of Rule 6A of the Service Tax Rules, 1994, unless and until the payment consideration in convertible foreign exchange against the export of service is received, the export of service is not complete - the relevant date of one year for filing of refund claim should be reckoned from the date of receipt of convertible foreign exchange - appeal dismissed - decided against Revenue.

Summary

Issues:
- Determining the time period for filing a refund under Rule 5 regarding export of service.

Analysis:

The issue in this case revolves around the interpretation of the time period for filing a refund claim under Rule 5 concerning the export of service. The Revenue argues that the refund should be filed within one year from the date of the invoice, while the respondent contends that it should be calculated from the receipt of convertible foreign exchange against the export of service.

The Revenue, represented by the Jt. Commissioner, asserts that the refund claim period should be computed from the date of the invoice, not from the receipt of convertible foreign exchange. They argue that the definition of export service under Rule 5 has evolved, making previous judgments irrelevant. They highlight that the judgment in Bechtel India Pvt. Ltd. case is not applicable due to the different period involved and amendments in the definition of export service.

On the other hand, the respondent, represented by the counsel, argues that the limitation period for a refund under Rule 5 should be based on the date of realization of consideration towards the export of service. They rely on Notification No. 27/12-CE (NT) and Rule 6A of Service Tax Rules, emphasizing that the export of service is completed only upon receiving payment in convertible foreign exchange.

The Tribunal carefully considers both arguments and reviews the relevant provisions. It notes that the definition of export service under Rule 5 was amended post-1.7.2012, making the amended definition applicable to the claims under consideration. Rule 6A of Service Tax Rules specifies that payment for the service should be received in convertible foreign exchange for the export of service to be deemed complete. Therefore, the Tribunal concludes that the time limit for filing a refund claim should be calculated from the receipt of convertible foreign exchange.

In light of the above analysis, the Tribunal upholds the decision of the learned Commissioner (Appeals), dismissing the Revenue's appeals. The judgment clarifies the interpretation of the time period for filing a refund claim under Rule 5 concerning the export of service, emphasizing the significance of receiving payment in convertible foreign exchange for completing the export of service.