SEZ refund eligibility for input services consumed within the zone upheld under the notification framework.

An SEZ unit's refund claim for service tax paid on input services was held admissible even where the services were wholly consumed within the SEZ. The Tribunal applied Notification No. 9/2009, as amended by Notification No. 15/2009-ST, and followed its earlier decisions, including the assessee's own case, to reject the view that refund was confined to services not wholly consumed in the SEZ. The operative principle was that once service tax had been paid by the service provider, the SEZ unit remained eligible for refund under the notification framework. The claim was therefore allowed, subject to the amount not pressed.

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Issues: Whether an SEZ unit was entitled to refund of service tax paid on input services even where the services were wholly consumed within the SEZ.

Analysis: The refund claim arose under Notification No. 9/2009 dated 03.05.2009 as amended by Notification No. 15/2009-ST dated 20.05.2009. The earlier rejection was based on the view that refund was available only where the services were not wholly consumed within the SEZ. The Tribunal followed its earlier decisions, including the assessee's own case, and held that where service tax has already been paid by the service provider, the SEZ unit remains eligible for refund even if the services are wholly consumed within the SEZ.

Conclusion: The issue was decided in favour of the assessee, and the refund claim was held allowable, subject to the amount not pressed.

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