9911796707
TMI Blog2018 (6) TMI 340X X X X Extracts X X X X X X X X Extracts X X X X ..... se the foreign remittance in Indian rupees through Deutsche Bank is the receipt of payment in convertible foreign exchange. The Commissioner (Appeals) has rightly overruled the decision of Additional Commissioner rejecting the claim of refund for the export services to the claimant for want of remittance in convertible currency - refund allowed - appeal dismissed - decided against Revenue. - Service Tax Appeal No. ST/50774/2018 [ SM ] - Final Order No. 52148 /2018 - Dated:- 6-6-2018 - Hon ble Mrs. Rachna Gupta, Member ( Judicial ) For the Appellant : Mr. P. Juneja, D.R. For the Respondent : Ms.Aishwarya Raj Laxmi Sethi, Advocate ORDER Per : Rachna Gupta Present is an appeal against the order of Commissioner (Appeals), Central Tax (Appeals-II), Delhi dated 30th November, 2017 filed by CGST, New Delhi. 2. Facts relevant for the purpose are that M/s. PHG Hotels, New Delhi Pvt. Ltd. (referred to as claimant) is providing consultancy services, which, as per their ST-2 description of service, is mentioned as Promotion, Marketing, Organizing or assisting in organizing games of chance including lottery etc. as defined in Section 65(105) (zzzzn) having regist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h respect to invoice dated 31.10.2015. It is also submitted that the refund with respect to the export services has also been wrongly allowed to the claimant by Commissioner (Appeals). Rule 6A of Service Tax Rules, 1994 is being impressed upon submitting that the payment received for export services has mandatorily to be in convertible foreign currency. Impressing upon the order under challenge to be beyond the legal principles, appeal is prayed to be allowed. 6. While rebutting these arguments, the claimant respondent had submitted that Claimant s Company is not an intermediary service provider but is a market surveyor and provided business support services as that of liaisoning. It is also impressed upon that no invoice has been raised to the Indian party. All contracts were entered with the U.S. entity. The money has been received through FICRs the mandate of it being a convertible currency has no subsequent meaning. The Commissioner (Appeals) has rightly modified the order to that extent. 7. After hearing both the parties and perusing the record, it is observed and held as: The issue involved in the present case is of refund claim of unaccumulated Cenvat Credit against ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order to that extent. 9. Now coming to the aspect of receiving payment for export services in convertible currency, it hold: Since it is also apparent that the Indian Rupees is received from the recipient of the services through their foreign bank i.e. Wachovia Bank N.A. USA receipt of Indian Rupees shall be treated as 'convertible foreign exchange'. It also clearly certified in the FIRC issued by the HDFC Bank that remittance is in convertible foreign exchange. This Tribunal in the case of Sun Area Real Estate Pvt. Ltd. vs. Commissioner of Service Tax, Mumbai-I 2015 TIOL 956 CESTAT MUM giving detailed findings held that Indian Rupees received against export of services through foreign bank is convertible foreign exchange and the same is in compliance of the condition provided in the Export of Services Rules, 2005. The relevant paras of the order of Sun-Area Real Estate Pvt. Ltd. case are reproduced below: 5. It is not in dispute that the remittance towards the payment of service was received in Indian rupees. However, though the payment is received in Indian rupees but the bank has issued Foreign Inward Remittance Certificate . Clause 3A.6(i) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e account of a bank situated in any country outside India maintained with an authorised dealer, the payment in rupees shall be deemed to have repatriated the realized foreign exchange to India. In the present case, the payment in Indian rupees was received from foreign country through Deutsche Bank. Therefore, the said Indian rupee is nothing but foreign exchange repatriated from foreign country to India. Therefore, such payment in rupees is equal to the foreign exchange. The manner of receipt of foreign exchange is provided under Notification No. FEMA 14/2000-RB dated 03/05/2000 issued by Reserve Bank of India. Regulation No.3 of the said Notification is reproduced below: 3. Manner of Receipt in Foreign Exchange:- (1) Every receipt in foreign exchange by an authorised dealer, whether by way of remittance from a foreign country (other than Nepal and Bhutan) or by way of reimbursement from his branch or correspondent outside India against payment for export from India, or against any other payment, shall be as mentioned below: Group Manner of receipt of foreign exchange (1) Member countries i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e due to the foreign reinsurer is remitted (and expressed so) in dollars. It is common ground that the entire transaction effected through the media of the Reserve Bank of India is expressed in foreign exchange and in effect the retention of the fee due to the appellant Is dollars for the services rendered. This, according to us, is receipt of income in convertible foreign exchange. It seems to us that a two way traffic , is unnecessary. To insist on a formal remittance to the foreign reinsures first and thereafter to receive the commission from the foreign reinsurer, will be an empty formality and a meaningless ritual, on the facts of this case. On a perusal of the nature of the transaction and in particular the statement of remittance filed in the Reserve Bank of India regarding the transaction filed in the Reserve Bank of India regarding the transaction, we are unable to uphold the view of the respondent that the income under the agreement is generated in India or that the amount is one not received in convertible foreign exchange. We are of the view that the income is received in India in convertible foreign exchange, in a lawful and permissible manner through the premier inst ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
