2023 (10) TMI 1304 - HC - Service Tax

Recovery of service tax on premium received towards marine policy - exemption provided under N/N. 3/1994 related to premium collected on insurance of export of goods from India - HELD THAT - In the facts and circumstances of the case, it would be appropriate that the proceedings instead of being remanded to the adjudicating officer, as done by the tribunal ought to be remanded to the CESTAT, so as to consider these issues on which the questions of law have been posed for our consideration. Once these issues are examined and decided by the tribunal, the other issues if they arise, can be gone into, in regard to which all contentions of the parties would be required to be kept expressly open - the impugned order set aside - appeal disposed off.

Summary

Issues Involved:
The judgment involves questions of law related to the Central Excise Act 1944 and the Finance Act, 1994, specifically addressing the acceptance of an order passed by the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) regarding the recovery of a significant amount on 'premium' received towards 'marine policy' for a specific period.

Details of the Judgment:

Issue 1: Acceptability of CESTAT Order
The appellant challenged the CESTAT order questioning the acceptability of the Order-in-Original dated 09 September, 2015, which proposed recovery of a substantial amount based on 'premium' received towards 'marine policy' for the period from 2006-07 to 2013-14. The tribunal remanded the matter back to the original authority for further adjudication due to incomplete adjudicatory process, impacting the acceptability of the order.

Issue 2: Core Legal Issues
The appellant raised questions of law regarding the scope of 'premium collected on insurance of export of goods from India' and the validity of the CESTAT order of remand. The appellant contended that the inland transportation from a place within India to the port of export should be exempted under Notification No. 3/1994, as the insurance risk for export cargo commences from the loading point till the port of export.

Issue 3: Examination of Premium Breakup
The CESTAT order was influenced by a CERA objection regarding the appellant not paying Service Tax on the entire 'Marine Insurance Premium' collected. The tribunal observed that the demand for the period 2006-11 was dropped based on CERA's acceptance of appropriate tax discharge. However, the tribunal found shortcomings in the adjudicating authority's examination and the lack of detailed evaluation for subsequent periods.

Conclusion:
The High Court set aside the CESTAT order and restored the proceedings for adjudication on the specific issues raised by the appellant. The court emphasized that all contentions of the parties should be kept open for consideration once the tribunal examines and decides on the issues at hand. The remand was limited to the questions of law presented, without delving into other issues not raised before the court.