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TMI Blog2024 (7) TMI 478X X X X Extracts X X X X X X X X Extracts X X X X ..... ve an assessee of the benefit available to him in law with a view to augment the quantum of duty for the benefit of the Revenue. They must act reasonably and fairly' - The appellant who has paid the duty which was exempted, hence cannot be denied a refund stating that such services are exempt ab-initio, and that the taxpayer has no option to pay tax and claim refund. The order hence merits to be set aside. Invoice addressed to corporate office - HELD THAT:- The department could have verified the proper use / receipt of the input services by the appellant. Trade facilitation involves taking such an extra step. In case dual use of invoice or non-provision any service was detected, or the appellant was not able to discharge the burden of proof regarding the admissibility of the CENVAT credit, then a reasoned decision could have been taken to deny the credit. Merely rejecting a valid invoice since it is addressed to the corporate office was not warranted. Further there is no allegation that the input services were not received or utilised by the Appellant. In absence of any such dispute, denial of refund solely on ground that the Invoice is in the name of Corporate Office is unjust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of Notification No. 40/2012-ST dated 20.06.2012), they are eligible to claim refund of the service tax which they have paid to the service provider. It is found that the legal position has been correctly stated by the appellant on both the issues and hence, refund can t be denied on the said issue. Rejection of refund on tax paid on container repair charges - HELD THAT:- It would be relevant to state that as per the Apex Court s judgment in PEEKAY RE-ROLLING MILLS (P) LTD. VERSUS ASSISTANT COMMISSIONER AND ANOTHER [ 2007 (3) TMI 356 - SUPREME COURT] , exemption does not negate a levy of tax altogether. Despite an exemption, the liability to tax remains unaffected, only the subsequent requirement of payment of tax to fulfil the liability is done away with. Moreover, an exemption notification should be interpreted strictly; the burden of proving applicability would be on the assessee to show that his case comes within the parameters of the exemption clause or exemption notification. Section 26(1)(e) of the Special Economic Zones Act, 2005 states that subject to the provisions of sub-section (2) thereof, every developer and entrepreneur shall be entitled to exemption from Service Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal 1. Services wholly consumed in SEZ 9,30,811 7,23,020 68,454 5,16,405 60,853 4,25,945 27,25,488 2. Xerox copy of invoices produced at the time of filing of refund claim* 28,066 40,137 54,122 1,02,824 29,106 68,861 3,23,116 3. Alleged non- production of invoices at the time of filing of refund claim* 413 46 13,188 1,199 10,691 - 25,537 4. Service received in SEZ- invoice is addressed to corporate office in Mumbai - 2,781 87,008 - 2,781 - 92,570 5. Alleged non- existence of signed invoice - - 7,335 - 2,853 - 10,188 6. Alleged wrong date mentioned in invoice. - - 716 - - - 716 7. Denial of refund due to exchange rate fluctuation. - 22,963 7 890 1,393 4,951 30,204 8. Denial of refund on Container repair service received in SEZ unit. 1,032 - - - - - 1,032 9. Alleged non- availability of payment proof at the time of claiming refund. 382 - - - - - 382 Total 9,60,704 7,88,947 2,30,830 6,21,318 1,07,677 4,99,757 32,09,233 *The Appellant submits that original invoices were filed before the First Appellate Authority, and the same is undisputed. He stated that the case of the Department is that such services are exempt ab-initio, and that the taxpayer has no option to pay tax and claim refu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... activity falls within scope of commercial or industrial construction service approved by MPEZ. Thus, rejection of refund is unsustainable. He hence prayed that the impugned order may be set aside and their refund claim allowed in full. 3.2 The learned AR has taken us through the impugned order and reiterated the points given therein. He prayed that the appeal be rejected. 4. I have gone carefully through the appeal papers and have heard the rival parties. The issues raised by the appellant are discussed issue wise below. Services consumed wholly within SEZ 5. It is the Department case that the impugned services are exempt ab-initio, and that the taxpayer has no option to pay tax and claim refund and hence the claims were rejected. I find that SEZ is a specifically delineated duty-free enclave, deemed to be a foreign territory for the purposes of trade operations and duties and tariffs. The levy of Service Tax under the Finance Act 1994 (FA 1944) is subject to the overriding effect under Section 51 of the SEZ Act. Section 26(1)(e)of the SEZ Act provides exemption from Service Tax under Chapter V of the FA 1994 on taxable services provided to a Developer or Unit to carry on the autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt proof. 9. The appellant is aggrieved by the Department denying refund on ground that some of the invoices have no signature or bear wrong date or do not show any proof of payment. The Appellant submits that the defects raised are only procedural in nature. I find that an invoice is an important document, it serves as an agreement between a business and its customers, evidencing goods sold or services rendered, tax paid and payment owed or received. In the context of Indirect Taxation, they assume even more importance in the MODVAT/ CENVAT/ GST credit era in as much as, when taken as credit in the books of account, they are instantaneously equivalent to liquid cash for payment of duty. An invoice showing a payment of duty of Rs. one crore when taken into the books of a manufacturer or service provider can be instantly used for the discharge of duty payable of the same amount at the same time of entry into books of account. The temptation for creating a fake or irregular document so as to avoid availing a costly loan facility is great and has to be guarded against, by a strict adherence to Rules. In daily life no person, would be prepared to freely allow the bank to encash a chequ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iving sufficient reason for the same, they should be processed as in the normal course. In the case of photocopies of invoices, if sufficient reason is shown by the appellant as to why the originals could not be submitted, the same can be verified and if found correct as per the proof submitted by the appellant, the refund claim can be processed after obtaining an indemnity bond as is the departmental procedure. The Supreme Court, in the case of Sambhaji and Others v. Gangabai and Others, [(2008) 17 SCC 117], has held that procedure cannot be a tyrant but only a servant. It is not an obstruction in the implementation of the provisions of the Act, but an aid. The procedures are handmaid and not the mistress. It is a lubricant and not a resistance. Hence the rejection of a part of the claim on this ground that photo copies of invoices have been filed along with the refund claim, even though the original documents were produced at a later stage was not proper and merits to be set aside. Claim may be verified with the original invoices submitted. In case of any discrepancy in documents that is noticed the matter can be examined as at para 9 above. Exchange rate fluctuations 11. As rega ..... X X X X Extracts X X X X X X X X Extracts X X X X
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