Custom, Excise & Service Tax Tribunal
) Faizan Shoes Pvt. Ltd vs Commissioner Of Service Tax, Chennai on 16 December, 2011
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal Nos.ST/MISC/541-544/11 & ST/365-368/11,
ST/369/11
[Arising out of Order-in-Appeal No.27/2011, 28/2011 30/2011, 31/2011 & OIA No.32/2011 (MST) all dt. 18.3.2011 passed by the Commissioner of Central Excise (Appeals), Chennai]
1) Faizan Shoes Pvt. Ltd.
2) T.Abdul Wahid Tanneries Pvt. Ltd.
Appellants
Versus
Commissioner of Service Tax, Chennai
Respondent
Appearance:
Shri N.Viswanathan, Advocate Shri V.V.Hariharan, JCDR For the Appellants For the Respondent CORAM:
Honble Dr. Chittaranjan Satapathy, Technical Member Date of hearing : 16.12.2011 Date of decision : 16.12.2011 Final Order No.____________ Heard both sides. The four MISC applications filed by the appellants are for incorporation of additional grounds. The same are allowed in the absence of any opposition from the departments side.
2. The appellants are exporters who have claimed refund of service tax amounts paid on services in relation to the exports under Notification No.41/2007-ST dt. 6.10.2007. These have been rejected by the authorities below on one or the other grounds mentioned below :-
1. At the time of export, proviso (e) to para-1 of the said notification required that the exporter should not have availed drawback of service tax. This condition is not satisfied by the appellants on the date of export eventhough the condition itself was omitted w.ef. 7.12.2008 prior to filing of the refund claims.
2. At the time of export, the said notification provided a time limit of 6 months for filing of the refund claim eventhough, by the time the claims were filed, the time limit was extended to one year w.e.f 7.7.2009.
3. The said notification provided a condition that the exporters shall declare the amount of commission in the shipping bill.
3. Shri N.Viswanathan, ld. advocate appearing for the appellants, states that in the case of WNS Global Services (P) Ltd. Vs CCE Mumbai 2008 (10) STR 273 (Tri.-Mumbai) the Tribunal has held in paragraph 10 thereof that where the refund claims are filed after an amendment and the requirements are satisfied, the refund claims cannot be rejected. He states that on the date of refund application, there was no requirement that drawback should not have been taken and also the time limit was also extended to one year. Hence, all the refund claims are admissible. As regards the omission of the commission amount in the impugned shipping bills in few cases, he states that the SCNs were silent on this ground and hence impugned orders are beyond the grounds taken in the SCN and further that this was only a procedural condition.
4. Ld. JCDR appearing for the department opposes the contentions made on behalf of the appellants and cites the decision of the Tribunal dt. 18.8.2011 in the case of CCE Madurai Vs Shiva Tex Yarn & Others in Appeal Nos. ST/432, 433/2011 to the effect that the amendments to a notification are only of prospective effect.
5. After hearing both sides, I find that the decision cited by the ld. JCDR is rendered by a Single Member Bench whereas the decision cited by the ld. advocate is that of a Division Bench including the Single Member who has rendered the decision dt. 18.8.2011. As such, the Division Bench decision is required to be followed in preference to the Single Member Bench decision. Secondly, the provisions contained in the cited notification have been extended to free the Indian exports from domestic taxes by refunding the service tax so that the domestic taxes are not exported along with the goods and the Indian goods become competitive in the international market. This objective would also be served by following the decision of the DB. Further, I find that when the time limit was extended from 60 days to 6 months, the Board itself by circular dt. 12.3.2009 clarified that pending claims should be dealt with applying the amended proviso as also noted by another Bench of the Tribunal in the case of CCE Surat Vs Essar Steel Ltd. 2010 (20) STR 769 (Tri.-Ahmd.). Accordingly, following the cited decision of the Tribunal in the case of WNS Global (supra) and the Boards circular dt. 12.3.09, I am of the view that in regard to both the objections raised i.e. clause relating to non-availability of drawback as well as for the time limit, the amended provisions as applicable on the date of filing of refund claims require to be applied.
6. As regards the non-mention of the commission amounts in the shipping bill, this is a mere procedural condition and the refund claims can be considered if there is documentary evidence regarding the amount of service tax paid on the actual amounts of commissions disbursed.
7. In view of my findings as above, the impugned orders are set aside and all the five appeals are allowed with the direction that the refund amounts be allowed to the appellants, if otherwise due.
(Dictated and pronounced in open court) (Dr. CHITTARANJAN SATAPATHY) TECHNICAL MEMBER gs 5