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2024 (9) TMI 694 - AT - Service TaxRefund of service tax paid to the service providers on service received - specified services - services can be considered as wholly consumed within SEZ unit or not - Revenue s contention is that since services related to erection, installation of transmission line for the transmission of power which is generated in the SEZ, the said transmission line is located outside SEZ area - HELD THAT - It cannot be said that the service was exclusively used in the authorized operation of SEZ. On this, the Revenue cannot be agreed upon and the Learned Commissioner (Appeals) is completely agreed for the reason that for the purpose of generation of electricity and transmission thereon it is very obvious that the transmission line can travel beyond SEZ also but the fact remains that transmission line is used for the transmission of the electricity generated in the SEZ. Therefore, it can be conveniently concluded that the transmission line installed even though outside the SEZ but the same is used for the authorized operation of the SEZ unit. Therefore on this ground Revenue seeking of refund will not be sustainable. As regard other issues that the appellant are operating their business in SEZ as well as in DTA, and the electricity generated in appellant s unit is used for both the operations. Therefore, the Revenue s contention is that the services on which refund under Notification No. 12/2013-ST claimed by appellant is not tenable - all the identical facts has been considered by this Tribunal consecutively in the two judgments and held that on this ground refund cannot be denied - reliance can be placed in ADANI POWER LTD. VERSUS CST AHMEDABAD AND VICE-VERSA 2016 (3) TMI 231 - CESTAT AHMEDABAD . There is no infirmity in the impugned order of the Commissioner (Appeals) - the impugned order is upheld - Appeal of Revenue dismissed.
Issues Involved:
1. Whether the services received by the claimant were wholly consumed within the SEZ unit. 2. Whether the claimant is entitled to a refund of service tax paid on services used for both SEZ and DTA operations. 3. The power of the Commissioner (Appeals) to remand the matter for de novo adjudication. 4. Specific issues related to the rejection of refund claims on various grounds. Issue-wise Detailed Analysis: 1. Whether the services received by the claimant were wholly consumed within the SEZ unit: The Revenue contended that since the services related to the erection, installation of transmission lines for transmitting power generated in the SEZ were located outside the SEZ area, the services were not exclusively used in the authorized operation of the SEZ. The Tribunal disagreed, stating that for generating and transmitting electricity, it is obvious that transmission lines may extend beyond the SEZ. However, as the transmission lines are used for transmitting electricity generated within the SEZ, they are considered used for authorized SEZ operations. Therefore, the Revenue's claim for rejecting the refund on this ground is unsustainable. 2. Whether the claimant is entitled to a refund of service tax paid on services used for both SEZ and DTA operations: The Tribunal referred to previous judgments in the claimant's own case, which established that the claimant fulfilled the condition of Para 2(b) of the notification by obtaining a list of taxable services required for authorized operations approved by the SEZ Approval Committee. The claimant did not own or carry out any business other than SEZ operations, as per the declaration under Para 2(c) of the notification. The Tribunal found that the services were not wholly consumed within the SEZ, but the refund should not be restricted under Para 2(d) of the notification, as there was no evidence of a DTA unit of the claimant. The Tribunal concluded that the claimant is entitled to the refund as the services were used for authorized SEZ operations, and the surplus power supplied to DTA does not constitute a separate business. 3. The power of the Commissioner (Appeals) to remand the matter for de novo adjudication: The Tribunal upheld the Commissioner (Appeals)'s power to remand the matter for de novo adjudication, citing the Gujarat High Court's judgment in Commissioner of Service Tax v. Associated Hotels Ltd., which confirmed that the Commissioner (Appeals) has the authority to remand cases for fresh adjudication. This power is not curtailed by any reference to sub-section (5) of Section 85 of the Finance Act, 1994. Therefore, the appeals filed by the Revenue on this ground were rejected. 4. Specific issues related to the rejection of refund claims on various grounds: The Tribunal addressed several specific issues related to the rejection of refund claims: - Transport by air for domestic journey: The service provided by M/s. Karnavati Aviation Pvt. Ltd. was initially not covered under the approved service category. However, subsequent classification by the Revenue under "Supply of Tangible Goods" required re-examination. - Reimbursement of expenses: The Tribunal remanded this issue for verification. - Services not consumed in relation to authorized operations: The Tribunal remanded this issue for verification. - Supporting documents not provided: The Tribunal remanded this issue for verification. - Letter provided by GETCO: The Tribunal remanded this issue for verification. - Services wrongly classified: The Tribunal remanded this issue for verification. - Service category not approved: The Tribunal remanded this issue for verification. The Tribunal found that the Commissioner (Appeals) had already remanded some portions of the refund for verification, and it was appropriate for the adjudicating authority to examine these issues on merit in de novo adjudication. Conclusion: The Tribunal upheld the impugned order of the Commissioner (Appeals) and dismissed the Revenue's appeal, confirming that the claimant is entitled to the refund of service tax paid on services used for authorized SEZ operations. The Tribunal also confirmed the Commissioner (Appeals)'s power to remand the matter for de novo adjudication. The appeals filed by the assessee were disposed of by way of remand to the adjudicating authority for further verification and adjudication.
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