2018 (5) TMI 551 - AT - Service Tax

100% EOU - Export of services - whether the Appellant-M/s Jubilant Chemsys Limited have exported the service and received convertible foreign exchange as required under the Export of Service Rules? - Held that - the issue is no longer res-integra in their own case Jubilant Chemsys Limited Versus C.C. & C.E. & S.T. - Noida And (Vice-Versa) 2017 (7) TMI 62 - CESTAT ALLAHABAD , for the preceding period April, 2005 to March, 2011 this Tribunal have held that the appellant have satisfied both the conditions for export of service, namely rendering of service from India and receipt of the service by the client outside India of consideration in convertible foreign currency in India - decided in favor of appellant. Levy of interest - Held that - no Service Tax was payable by the appellant - when tax has been paid by way of debit note to the Cenvat credit account and such credit was available all throughout during the due dates for payment of tax, no interest is leviable. - interest set aside. Penalty - Held that - there being no violation of the provisions of law, the penalty imposed is also set aside. Appeal allowed - decided in favor of appellant.

Summary

Issues: Whether the appellant exported the service and received convertible foreign exchange as required under the Export of Service Rules.

Analysis:
The case involved a dispute regarding the export of services by M/s Jubilant Chemsys Limited and the receipt of convertible foreign exchange. The Show Cause Notice alleged that the appellant was providing R&D services to an associate company, leading to a demand for Service Tax. The Additional Commissioner confirmed the demand along with interest and penalties. The appellant, after paying the Service Tax, appealed to the Commissioner (Appeals) seeking to set aside the interest and penalty, which was rejected. The appellant then approached the Tribunal, citing a previous order in their favor for a different period. The Tribunal in the previous order had found that the appellant had exported services and received payments in convertible foreign exchange, setting aside the demand. The appellant argued for similar treatment in the present case, supported by a ruling in another matter. The Tribunal considered the arguments and found in favor of the appellant. It held that no Service Tax was payable, no interest was leviable due to payment through debit note to the Cenvat credit account, and set aside the penalty. The appeal was allowed with consequential benefits to the appellant, as per law.

In conclusion, the Tribunal's judgment resolved the issue in favor of the appellant, emphasizing the previous order's findings and legal precedents. The decision highlighted compliance with export rules, payment of taxes, and the availability of credit in the Cenvat account as key factors in determining the outcome. The ruling provided relief to the appellant by setting aside the demand for interest and penalty, aligning with established legal principles and precedents cited during the proceedings.