SEZ service tax exemption for sub-contractors applies when services support authorised operations and are duly approved.

Services provided in a Special Economic Zone for authorised operations qualify for service tax exemption where they are approved by the competent authority and are received for the developer or unit. The fact that the service provider acted as a sub-contractor did not, by itself, defeat the exemption under Notification No. 9/2009-ST as amended by Notification No. 15/2009-ST. On that reading, denial of exemption solely because the claimant was not in direct contractual privity with the SEZ unit or developer was unjustified, and the exemption remained available for such SEZ-related services.

---

---

Issues: Whether a sub-contractor providing services in a Special Economic Zone in relation to authorised operations is entitled to exemption from service tax under Notification No. 9/2009-ST dated 03.03.2009 as amended by Notification No. 15/2009-ST dated 20.05.2009.

Analysis: The exemption was denied only on the ground that the appellant acted as a sub-contractor and did not provide services directly to the SEZ unit or developer. On a plain reading of the notification, the relevant criteria are that the services must be provided in relation to authorised operations in the SEZ and received by a developer or unit. The services in question were approved by the competent authority and were rendered in relation to authorised operations in the SEZ. The fact that the appellant acted as a sub-contractor did not defeat the exemption, and the cited Tribunal decisions supported that view.

Conclusion: The appellant was entitled to the exemption and denial of exemption was unjustified.

---