Custom, Excise & Service Tax Tribunal
Shipo It Pvt Ltd vs Mumbai East on 6 May, 2019
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
MUMBAI
WEST ZONAL BENCH, MUMBAI
Service Tax Appeal No. 87356 of 2018
(Arising out of Order-in-Appeal No. MUM-DGPM-WRU/APP-48/17-18 dated
23.03.2018 passed by the Principal Additional Director General, DGPM, WRU,
Mumbai.)
M/s Shipco IT Pvt. Ltd. ........Appellant
Times Squares, 701, A-Wing,
Andheri Kurla Road, Andheri (E)
Mumbai - 400 059
VERSUS
Commissioner of CGST, Mumbai East ........Respondent
th
9 Floor, Lotus, Lotus Infocentre,
Near Parel Station, Parel East,
Mumbai - 400 012
APPERANCE:
Shri Kavish Shah, C.A. with
Shri Rushabh Gandhi for the Appellant
Shri Sudhir B. Mane, Assistant Commissioner, Authorised Representative
for the Respondent
CORAM:
HON'BLE DR. SUVENDU KUMAR PATI, MEMBER (JUDICIAL)
FINAL ORDER NO. A/85849/2019
Date of Hearing: 31.12.2018
Date of Decision: 06.05.2019
Rejection of refund claim against unutilised CENVAT credit
availed during export of 'Information Technology Software Services'
ST/87356 of 2018
2
on the ground that FIRCs received from bank, do not show the
invoice detail on the remittance certificate issued by the bank, is
assailed in this appeal by the appellant.
2. Factual backdrop of the case is that appellant is an exporter of
'Information Technology Software Services'. It filed two refund
claims for the quarter April, 2015 to June, 2015 and July, 2015 to
September, 2015 on 28.03.2016 and 27.06.2016 respectively before
the Assistant Commissioner (Refunds) of Service Tax
Commissionerate-V, Mumbai for Rs. 2,14,659/- and Rs. 7,40,660/-
respectively in conformity to Notification No. 27/2012-CE (NT) dated
18.06.2012 issued under Rule 5 of the CENVAT Credit Rules, 2004
along with relevant documents but, the refund was refused by the
first adjudicating authority on the ground that FIRCs do not bear
invoice no. and the contention of the claimant that FIRCs received
from bank do not show the export invoice details as per bank
policy/mandate was unbelievable and unacceptable for which such
rejection of refund was made as a safeguard to protect Government
Revenue. In the appeal before the Principal Additional Director
General (PADG), DGPM, WRU, Mumbai the same rejection order
found confirmation despite the fact that the findings of the
adjudicating authority that statement submitted by the appellant was
not tallying with the export invoices and foreign remittance was held
as invalid by the PADG. The only ground of rejection therefore
remained confined to the unacceptability of appellant's contention
that FIRCs received from bank did not reflect the export invoice
ST/87356 of 2018
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details as per bank policy/mandate. Appellant assailed the said
rejection order before this forum.
3. In the memo of appeal and during the course of hearing of
appeal, learned Counsel for the appellant Shri Kavish Shah, and Shri
Rushabh Gandhi submitted that in view of clarificatory Circular No.
112/06/2009-ST dated 12.03.2009 issued by the Central Board of
Excise and Customs, linkage between export invoice and remittance
is not required when FIRCs are issued on consolidated basis to
exporters by their customers regularly and refund should be allowed
on such certified statements of the claimant, who is required to
maintain register showing running account that should reconcile with
export and remittance periodically. Placing his reliance on the
decision of CESTAT, Bangalore in the case of Broadcom India
Research Pvt. Ltd. Vs. Commissioner of Service Tax, Bangalore
reported in 2016 (42) STR 79 (Tri.-Bang.), he further submitted that
self certification of FIRCs is sufficient and there is no need for
banker's certificate of FIRCs to meet the requirement of Rule 5 of
CENVAT Credit Rules, 2004 or Section 11B of the Central Excise Act,
1944 as applicable to the Service Tax vide Section 83 of the Finance
Act, 1994 and in such a case refund is to be allowed when assessee
had furnished with reconciliation statement showing of export invoice
relating to particular FIRCs in respect of the period covered by refund
claim for which order of the PADG is required to be set aside,
entitling the appellant to get refund with applicable interest.
ST/87356 of 2018
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4. Learned Authorised Representative for the respondent-
department Shri Sudhir B. Mane, Asst. Commissioner supported the
reasoning and rationality of the order passed by the Principal
Additional Director General, DGPM, WRU, Mumbai and argued that it
was rightly observed by the first appellate authority that despite
several dates of hearing granted to the appellant who was heard
personally, no such evidence was produced before the appellate
authority to establish that bank had a policy/mandate not to supply
such invoice detail against FIRCs and therefore Principal Additional
Director General's order as the first appellate authority needs no
interference by the Tribunal.
5. Heard from both sides at length and gone through the case
record and letter received from the appellant's bank M/s Kotak
Mahindra Bank, which was taken on record as produced in conformity
to Rule 23 of the CESTAT Procedure Rule. As found from the Order-
in-Original, it has been noted by the adjudicating authority that
claimant had submitted relevant documents for refund claim. In
para 3 of the order at point no. XI, copy of export ledger was stated
to have been received for refund processing along with export
invoices, FIRCs, export register etc. Going by the Circular dated
12.03.2009 such linkage in the FIRCs received by the bank with
invoice is not required to be obtained from the running account of
bank, if serf certified statement along with FIRCs showing the details
of the export in respect of which FIRC pertains is received to process
the refund favourably. It is also found from the letter of the M/s
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Kotak Mahindra Bank that they issued FIRC only for the receipt of
FDI and for all other inward remittances and Foreign Inward
Remittance Advise is issue for GST calculation in summary of Form.
The enclosed bank statement of appellant for the relevant period
received from the bank also indicates that out of total FIRCs value of
USD 149990 for the month of March, 2015 USD 73853.80 remittance
was received for invoices pertaining to April, 2015 to June, 2015 and
the balance USD 76136.20 was adjusted towards invoices pertaining
to period before 31.03.2015. Going by the Order-in-Original, it is
found that apparently the adjudicating authority had made his
observation that FIRCs received from bank had no co-relationship
with export invoice may be due to such arrear payment pertaining to
previous financial year made after March, 2015. Be that as it may,
since the appellate authority himself tallied the same and found no
error in the re-conciliation statement of the appellant, rejection of
refund claim on the ground that FIRCs statement submitted by the
bank did not contained invoice no. is contrary to the procedural
requirement in view of clarificatory Circular dated 12.03.2009.
Therefore, in carrying forward the judicial precedence set by the
CESTAT, Bangalore Bench in Broadcom India Research Pvt. Ltd.
judgment cited above that self certification of FIRC is sufficient as
there is no need for bankers certificate on FIRC, the following order
is passed.
ST/87356 of 2018
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ORDER
6. The appeal is allowed and the order passed by the Principal Additional Director General, DGPM, WRU, Mumbai vide Order-in- Appeal No. MUM-DGPM-WRU/APP-48/17-18 dated 23.03.2018 is hereby set aside. The appellant is entitled to get refund of Rs. 9,55,319/- along with applicable interest and the respondent- department is directed to pay the same within three months from receipt of this order.
(Order pronounced in the open court on 06.05.2019) (Dr. Suvendu Kumar Pati) Member (Judicial) Prasad