Drawback rules cannot bar service tax refund on export-related input services excluded from drawback computation.

Refund of service tax under Notification No. 41/2007-ST could not be denied merely because drawback had been claimed on specified services used for export of goods. The services were received after manufacture and were not included in the drawback computation, so the Tribunal held that the drawback rules did not apply to deny refund on such input services. Applying the earlier view in Mittal International, it concluded that the assessee remained entitled to the refund.

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Issues: Whether refund of service tax under Notification No. 41/2007-ST could be denied on the ground that drawback had been claimed on the specified services used for export of goods.

Analysis: The refund claim was rejected solely because drawback had been claimed on specified services. The Tribunal noted that the services in question were received after manufacture of the goods and were not included while calculating the drawback claim. Relying on the earlier Tribunal decision in Mittal International, it held that the drawback rules were not applicable to such input services used for export of goods.

Conclusion: The refund claim could not be rejected on the ground of drawback, and the assessee was held entitled to the refund.

Ratio Decidendi: Drawback rules cannot be invoked to deny refund of service tax on input services used for export of goods where those services are not part of the drawback computation.

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