Custom, Excise & Service Tax Tribunal
C.C.E. Jaipur-Ii vs M/S Arihant Tiles & Marbles Pvt. Ltd on 2 November, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX
APPELLATE TRIBUNAL, NEW DELHI
PRINCIPAL BENCH, COURT NO. III
Service Tax Appeal No. ST/1383/2010-[SM]
[Arising out of Revision Order No. 04/Review/2010, dated 24.09.2010 passed by CCE Jaipur-II]
Service Tax Appeal No. ST/1470/2010-[SM]
[Arising out of Revision Order No. 39/JP-II/2010/ST/COMM, dated 09.07.2010 passed by CCE Jaipur-II]
For approval and signature:
Honble Mr. S.K. Mohanty, Member (Judicial)
1
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3
Whether Their Lordships wish to see the fair copy of the Order?
4
Whether Order is to be circulated to the Departmental authorities?
C.C.E. Jaipur-II Appellant(s)
M/s Arihant Tiles & Marbles Pvt. Ltd.
Vs.
M/s Arihant Tiles & Marbles Pvt. Ltd. Respondent(s)
C.C.E. Jaipur-II Appearance:
Mr. R. K. Mishra (DR) for the Appellant Mr. Karan Sachdev (Consultant) for the Respondent CORAM:
Honble Mr. S.K. Mohanty, Member (Judicial) Date of Hearing/ Decision. 02.11.2016 Final Order No. 54815-54816 /2016 Per S. K. Mohanty:
Feeling aggrieved with the impugned order dated 9.7.2010, both the assessee as well as Revenue have preferred these appeals before this Tribunal.
2. Brief facts of the case are that the assessee is engaged in export of iron ore and granite slabs. During the disputed period, the assessee had filed the refund application for Rs. 33,33,715/- under Notification No. 41/07-ST dated 6.10.2007. The said refund application was allowed by the Jurisdictional Assistant Commissioner of Central Excise of Service Tax vide order dated 17.07.2008. The said order was reviewed by the Commissioner of Central Excise and the impugned order dated 9.07.2010 was passed by him. In the said review order, out of the sanctioned refund amount of Rs. 33,33,715/-, proceedings initiated for recovery of Rs. 15,46,270/- were dropped and the balance amount of Rs. 17,87,445/- was ordered for recovery. The reasons assigned for recovery of such amount are that the taxable service namely, Terminal Handling Charges is not confirming to the port service and GTA Service availed for movement of export cargo from place of removal to the port of export prior to 19.02.2008 is not available for refund in terms of the above referred Notification. The Revenue has preferred the appeal against dropping of demand of Rs. 15,46,270/- and the assessee has filed the appeal against recovery of amount of Rs. 17,87,445/-.
3. Sh. Karan Sachdev, the Ld. Advocate appearing for the appellant submits that Terminal and other handling charges are in connection with export of consignment and those services were availed by the assessee within the port area. Thus, he submits that since the Terminal Handling services have been availed within the port area, irrespective of its classification, the same should be considered as port service for the purpose of availment of benefit of refund in terms of Notification dated 06.10.2007. To support such view, the Ld. Advocate has relied on the decision of this Tribunal in the case of Shivam Export vs CCE Jaipur reported in 2016-TIOL0376-CESTAT, Delhi, SRF Ltd. vs CCE Jaipur reported in 2015 (40) STR 980 (Tri. Mum) and Commr. Vs AIA Engineering Ltd. reported in 2014 (36) STR 1236 Guj.
3.1 With regard to transportation of goods from the place of removal to the port of export prior to 19.02.2008, the submission of the Ld. Advocate is that Notification No. 41/2007 was amended vide Notification No. 3/2008 dated 19.02.2008 and after the date of amendment, the refund claim was filed by the assessee. He further submits that identical issue has already been settled by this Tribunal in the case of East India Minerals Ltd. vs. CCE & ST, Bhubaneswar reported in 2012 (27) STR 18 (Tri. Kolkata).
3.2 With regard to testing and analysis service, the Ld. Advocate has submitted the certificate showing the agreement entered into between the assessee and the overseas buyers. Thus, he submits that since the agreement was entered between the assessee and the overseas buyer, the condition of Notification dated 6.10.2007 has been duly complied with for grant of refund.
3.3 With regard to the grounds raised in the Revenues appeal, the Ld. Advocate submits that there is correlation between transportation of goods from the factory to the port of export, which were duly exported under shipping bills signed by the customs authorities.
4. On the other hand, Sh. R.K. Mishra, the Ld. DR appearing for the Respondent reiterates the submission made in the grounds of appeal and furthers submits that the agreement entered with the overseas buyer were not produced before the authorities below to show that the goods were in fact exported by the assessee.
5. I have heard the Ld. Counsels for both the sides and perused the records.
6. It is an admitted fact on record that the services towards terminal and other handling services were availed b the assessee within the port area, in connection with export of the goods. Thus, irrespective of classification of service, since the same are provided within the port for export of goods, the benefit of refund should be available under the head Port Service in terms of notification dated 06.10.2007. In this context, the Tribunal in the case of Shivam Exports, SRF Ltd., and AIA Engineering (supra) have held that irrespective of the classification of service, if the services are provided within the port, the same should qualify as port service for the purpose of benefit of refund. Thus, I am of the view that the assessee is eligible for refund of Rs. 16,72,923/-.
7. With regard to GTA service availed for transportation of goods from the place of removal to the port of export, I find that the refund claim was filed after issuance of the Notification No. 3/2008 dated 19.02.2008. I also find that in an identical situation, this Tribunal in the case of East India Minerals Ltd. (supra) has allowed the refund claim to the appellant. The relevant portion in the decision is extracted herein below.
Following the ratio of the above cited decisions, and the Boards circular, and also keeping in view the objective of the Government policy to encourage exports and not to burden the export goods with domestic taxes, we are of the view that the impugned refund claims should be allowed, if otherwise due, since on the date of filing the claims, the requirement of the notification has been satisfied and the service taxes paid in respect of GTA services used for transport of the impugned goods for export from place of removal to the port have become refundable.
8. In view of above, I am of the opinion that the assessee is entitled for refund of Rs. 1,00,742/- paid on transportation charges for transport of goods from place of removal to the port of export.
9. As regards testing and analysis service, I find from the available records that the appellant had entered into the agreement with the overseas buyer for providing such service. Since, the agreement was in existence exist before exportation of goods, I am of the view that the requirement of Notification dated 06.10.2007 has been duly complied with by the assessee, for which refund claim cannot be denied.
10. The Revenue has preferred this appeal on the ground that no documents were produced by the assessee to show that the transportation charges were really incurred for export of the subject goods. On perusal of the documents, I find that there is correlation between the movement of goods from the place of removal to the port of export. However, I find that the assessee has not produced the copies of the agreements entered into between it and the overseas buyers. Since the contents of the agreements have to be verified by the Original authority, I am of the view that the matter should go back to the original authority for verification of the agreements. If agreements were entered into between the assessee and the overseas buyers for export of goods, the refund claim of Rs. 15,46,270/- should be allowed to the assessee. To sum up the appeal is disposed of in following terms:-
(i) The assessee is entitled for refund of Rs. 17,87,445/- and the impugned order to that extent is set aside and the appeal is allowed.
(ii) With regard to refund claim of Rs. 15,46,270/- filed by Revenue, the matter is remanded to the original authority for verification of the agreements along with Lorry receipts, evidencing transportation of goods from the place of removal to the port of export. If the said documents are in order, the benefit of refund of Rs. 15,46,270/- shall be extended to the assessee..
11. The appeals are disposed of in above terms.
(Dictated and pronounced in open court) (S. K. Mohanty) Member(Judicial) Neha 6 | Page ST/1383, 1470/2010-[SM]