SEZ refund under service tax exemption depends on prior Approval Committee approval at the time services are availed.

Refund under Notification No. 12/2013-ST for a Special Economic Zone developer was held admissible only where the specified services had been approved by the Approval Committee when the services were availed. Clause 3(I) was treated as a substantive condition linked to the time of receipt of services, not merely a requirement to be met before filing the refund claim. Because the impugned services were not approved at that stage, the exemption condition was not satisfied and refund was denied. The earlier decision cited by the assessee was distinguished because the revenue objection raised in the present matter had not been considered there.

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Issues: Whether refund under Notification No. 12/2013-ST dated 01.07.2013 was admissible when the specified services had not been approved by the Approval Committee at the time of availing the services.

Analysis: The notification granted exemption by way of refund to a developer of a Special Economic Zone, subject to approval of the list of services required for authorised operations. The condition in clause 3(I) was treated as a requirement to be satisfied at the time the services were availed, and not merely before filing the refund claim. Since the impugned services had not been approved by the Approval Committee when they were received, the condition for availing the exemption was not fulfilled. The prior decision relied upon by the assessee was distinguished on the ground that the revenue objection now raised was not considered there.

Conclusion: Refund was not admissible and the appeal was rejected.

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