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TMI Blog2014 (7) TMI 1014X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the refund claim seems to be misconstrued - Following decision of Cadila Health Care Ltd. [2009 (8) TMI 172 - CESTAT, AHMEDABAD] - Decided in favour of assessee. - ST/475/2011 - Final Order No. A/1570/2012-WZB/AHD - Dated:- 3-9-2012 - Shri M.V. Ravindran, Member (J) and B.S.V. Murthy, Member (T) Shri J.C. Patel, Advocate, for the Appellant. Shri S.K. Mall, AR, for the Respondent. ORDER This appeal is directed against Order-in-Appeal No. RT/22-29/LTU/MUM/2010, dated 26-8-2010. 2. The facts of the case, in brief, are that the appellants are registered under the category of Goods Transport Operator and having Service Tax registration No. AACCB7065RST001. The appellants filed a refund claim of ₹ 1,75,53,497/- on 4-6-2010 in terms of Notification No. 9/2009-S.T., dated 3-3-2009. The Development Commissioner, Kandla Special Economic Zone, Ministry of Commerce and Industry, Ahmedabad, under letter KASEZ/DCO/Pharmez/II/ 01-2009-10, dated 29-6-2009 had permitted setting up a unit to the appellants and the said approval letter was valid for a period of one year from the date of issue. The appellants also submitted the copy of approval list of taxable serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted letter issued by OSD for Development Commissioner, KSEZ wherein they were granted extension for letter of approval upto 28-6-2012 in respect of manufacturing activity. It was found that since the authorized operation had not started in SEZ and so the services received did not appear to be related to the authorized operation . (e) No descriptive bifurcation of the services rendered and service wise service tax paid was provided by the appellants. Hence, in the absence of bifurcation/classification of services, claimed as Scientific Technical Consultancy Services it cannot be ascertained whether these are specified in the list of approved taxable services. (f) The bills of CHL described the service provided as charges for rendering of technical and scientific services for research, development and analysis and testing of the products as identified by the appellants and assisting in activities relating to securing of registration and/or for regulatory approval by appellants for these products in USA and Europe . From the description of services mentioned it cannot be ascertained that the said services and the services related to regulatory approval by for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Aggrieved by such an order of the Adjudicating Authority, the appellant preferred an appeal before the First Appellate Authority. The First Appellate Authority after considering the submissions made by the appellant and also after granting personal hearing, concurred with the views taken by the Adjudicating Authority and upheld the order of the Adjudicating Authority, hence this appeal. 4. The ld. Counsel appearing on behalf of the appellant would take us through the findings recorded by the First Appellate Authority and submit that refund claim of the appellant has been rejected only on the ground that the appellant has received the Scientific and Technical Consultancy Services which are not related to the authorized operation of the appellant which is in the list. He submits that the appellants have produced a letter from the office of the Development Commissioner, KASEZ, which included the list of taxable services and the specific services which are to be considered as technical, testing and analysis and scientific or technical consultancy services. It is his submission that the Scientific Consultancy Service which has been received by the appellant is in respect of technica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... well as the Adjudicating Authority for rejecting the refund claim seems to be misconstrued. We also find that the contentions raised by learned Counsel, the ratio of the Tribunal in the case of Cadila Health Care Ltd., - 2010 (17) S.T.R. 134 (Tri.-Ahd.) (as cited by learned Counsel), would cover the issue in their favour, wherein the nexus of Technical Testing Analysis Services was discussed. 5. We have considered the submissions made by both the sides. As rightly submitted by the ld. Advocate on behalf of the appellants, the manufacturing process of medicaments is not comparable to other products. A medicine before it is released in the market has to undergo several stages of testing and technical analysis etc. and it is clear that all the products taken up by the Company for production may not reach to the customers as a commercial production as such, at all. Even the trial manufacture and R D conducted in respect of such drugs which did not reach to the market has to be considered as part of the manufacturing process and business activity. Therefore, we are unable to agree with the view taken by the department that in case the goods have not reached commercial productio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rds the refund claim of ₹ 6,66,794/- which has been rejected on the ground that the services to which this amount pertains do not have direct nexus with the authorized operations undertaken by the appellant, this stand of the department is totally incorrect. The Approval Committee which has examined this issue has issued a specific certificate to the appellant indicating the various services received by the appellant and justification for use of such services in relation to authorized operations. The jurisdictional Commissioner of Central Excise is also a member of this Approval Committee. One the Approval Committee has given the nexus and the justification, it was totally unwarranted on the part of the adjudicating authority and the appellate authority to go into this question and come to their own findings in the matter. Therefore, rejection by the lower authorities of the refund claims of the service tax paid on various services on this ground is bad in law and is accordingly set aside. 6.2 Coming to the next question, whether in respect of the services which were wholly consumed and which were fully exempt from payment of duty, whether the appellants can be granted ref ..... X X X X Extracts X X X X X X X X Extracts X X X X
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