SEZ refund claims must be tested under the correct exemption notification, with remand warranted for fresh hearing and evidence.

A SEZ unit's refund claim for services used in authorised operations should not be rejected merely because it was filed under the wrong service tax notifications. The applicable exemption was Notification No. 40/2012-ST, and reference to Notifications No. 41/2012-ST and No. 52/2011-ST in the application did not, by itself, defeat the claim. The matter required examination under the correct notification, and compliance with its conditions remained open because the claimant said the deficiency communication was not received and sought an opportunity to file evidence. The rejection was set aside and the matter remanded for de novo adjudication after hearing the claimant.

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Issues: Whether a refund claim by a SEZ unit could be rejected merely because it was filed under the wrong service tax notifications instead of the applicable notification, and whether the matter should be remanded for fresh adjudication on compliance with the notification conditions.

Analysis: The applicable exemption for services received by a SEZ unit for authorized operations was Notification No. 40/2012-ST, and the mere mention of Notification No. 41/2012-ST and Notification No. 52/2011-ST in the refund application did not justify rejection of the claim. The claim had to be examined under the correct notification, and the dispute on fulfillment of the notification conditions remained open because the appellant asserted that the deficiency communication was not received and sought an opportunity to produce evidence. In these circumstances, remand for fresh decision after hearing the appellant was warranted.

Conclusion: The rejection of the refund claim was set aside and the matter was remanded to the original adjudicating authority for de novo adjudication after granting hearing to the appellant.

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