Custom, Excise & Service Tax Tribunal
Commissioner Of Central Excise vs M/S. Mangalore Sez Ltd on 18 November, 2016
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeals (s) Involved: ST/2638/2011-SM (Arising out of Order-in-Appeal No.83/2011 Dated 15.07.2011 passed by Commissioner of Central Excise (Appeals), Mangalore.) Commissioner of Central Excise Mangalore Commissionerate, 7th Floor, Trade Centre, Bunts Hostel Road, Mangalore 575003. Appellant(s) versus M/s. Mangalore SEZ Ltd., 3rd Floor, Muda Building, Ashoknagar, Urwa Stores, Mangalore 575 006. Respondent(s)
Appearance:
Mr. Parashiva Murthy, A.R., For the Appellant None For the Respondent Date of Hearing: 18/11/2016 Date of Decision: 18/11/2016 CORAM:
Mr. Mohammed Yousuf, AR For the Respondent HON'BLE SHRI S.S. GARG, JUDICIAL MEMBER Date of Hearing: 30/09/2016 Final Order No. 21205 / 2016 PER S.S. GARG The present appeal is filed by Revenue against the impugned Order-in-Appeal dated 15.7.2011 vide which the Commissioner (Appeals) has allowed the refund claim rejected by the original authority on Scientific or Technical Consultancy Service and Chartered Accountants Service amounting to Rs. 5,35,572/- and also allowed Education Cess and Higher Secondary Education Cess on the service tax paid by the assessee.
2. Briefly, the facts of the present case are that the assessee is a holder of Service Tax Registration under the category of Renting of Immovable Property Service and Business Auxiliary Service. The assessee obtained the formal approval from the Ministry of Commerce and Industry, Govt. of India, for setting up a Special Economic Zone (SEZ) at Baikampady near Mangalore and are entitled to various duty benefits under SEZ Act 2005 and SEZ Rules 2006. The assessee filed a refund application dated 22.7.2010 for refund of Service Tax amounting to Rs. 9,54,353/- in terms of Notification No. 09/2009-ST dated 20.5.2009. On scrutiny of the refund claim, the Assistant Commissioner rejected the refund on Scientific or Technical Consultancy Service and Chartered Accountants Service as the same was not found in the approved list of specific services in Annexure II & III and consequently, denied the refund on these two services vide Order-in-Original dated 29.9.2010. In the same order, the Assistant Commissioner has also rejected the refund claim of Rs. 12,197 being Education Cess and Higher Education Cess and sanctioned the refund of Rs. 4,06,584/- being service Tax paid on the services mentioned in Annexure II or III. Aggrieved by the said order, the assessee filed an appeal before the Commissioner (Appeals) who vide his order dated 15.7.2011allowed the appeal of the assessee. Aggrieved by the said order, the Revenue has filed the present appeal.
3. I have heard the learned A.R. for the appellant and perused the material on record. None appeared on behalf of the respondent assessee.
4. The learned A.R. has submitted that the impugned order is not sustainable in law and the Commissioner (Appeals) has wrongly allowed the refund claim on Scientific and Technical Consultancy Service and Chartered Accountants Service because both the services do not fall in the approved list of specified services in either Annexure II or III at the relevant time.
5. On perusal of the impugned order, I find that the Commissioner (Appeals) after going through the impugned Order-in-Original has passed a detailed order and thereafter set aside the Order-in-Original. Here, it is pertinent to reproduce Paragraph 7 of the impugned order wherein the learned Commissioner (Appeals) has observed as under :
7. From the above, it appears to me that Governments intention is clear that the SEZ units should either not require to pay or if paid they are eligible for refund. Mere not mentioning the services in Annexure II & III is only a technical one which should not debar the substantial benefit. In this case, it is clear that the appellant who had availed the services inside the SEZ were not liable to pay Service Tax and the appellant who had availed the services inside the SEZ were not liable to pay Service Tax and the appellant who had paid the Service Tax foir the services availed within SEZ should not be penalised for the same. Therefore, denying the eligible refund to the appellant on the ground that services availed by the appellant were not listed in the annexure II & III is not justified. Therefore, I am inclined to allow the refund in respect of the above services. The amendment to the notification No. 09/2009 by Notification No. 15/2009 was beneficial in nature so that the units do not have to first pay the service tax and then come forward for refund if entire services were wholly consumed within the SEZ. Denying the refund in case the service tax had been paid would be against the both law and spirit. I also find that the learned Commissioner (Appeals) has also observed that during the personal hearing, the assessee produced the list of services approved by the Development Commissioner and in the amended list of services, Scientific or Technical Consultancy Service and Chartered Accountants Service are added to the certified list of services in Annexure III and therefore, the learned Commissioner (Appeals) has allowed the benefit of refund of service tax paid by the assessee on Scientific or Technical Consultancy Service and Chartered Accountants Service. Similarly, the learned Commissioner (Appeals) has allowed the refund of Education Cess and Higher Education Cess on the basis of Boards Circular No. 134/3/2011-ST dated 08.4.2011. After considering the submission of the learned A.R. and the facts on record, I do not find any infirmity in the impugned order passed by the Commissioner (Appeals) and, therefore, I uphold the same by rejecting the appeal of the Revenue.
(Operative portion of the order has been pronounced in open court) (S.S. GARG) JUDICIAL MEMBER /vc/