2017 (6) TMI 381 - AT - Service Tax

Service Tax Refund Eligibility Clarified: Export-Related Charges Allowed, Limitation Period from Tax Payment

The Tribunal upheld the rejection of a portion of the refund claim for specific services related to exporting goods but allowed refund for transport ... Refund claim - service tax towards the GTA services - Notification No. 41/200 ST - rejection on the ground that the details of linkage between transported goods and exported goods was not available and also on the ground that the tax paid on movement of empty containers from ICD/port to the appellant’s factory is not admissible - Held that: - It is seen that the transport documents contained the details of export goods along with exporter’s invoice numbers and container number. Apparently, these details can be connected with the shipment details available in the shipping bill to find proper linkage. On verification of such linkage, the claimed refund is available to the appellant - On the issue regarding movement of empty containers from the yard/ port to the factory of the appellant, it is seen that it is by now a well settled position that such movement is with reference to export of goods and service tax paid for the same is eligible for refund - refund allowed. Refund claim - services rendered by foreign commission agents - rejection on the ground of limitation - Held that: - The conditions mentioned in the notification are to be read harmoniously so that they will not result in conflict with each other - As the refund will rise only on payment of service tax, the claims filed within the period of limitation calculated from such payment, should be considered as filed in time - refund allowed. Refund claim - Terminal Handling Charges (THC) and documentation charges etc - denial on the ground that the appellants failed to produce evidence to the effect that these are attributable to port services - it was held claimed that THC was not a listed service prior to 07/07/2009 - Held that: - it is a well settled legal position that THC and documentation charges incurred by the appellant within the port area for the services relating to the export of goods, are to be considered as services eligible for refund of service tax - refund allowed. The matter has to go back to the Original Authority for a fresh decision - appeal allowed by way of remand. Issues involved:1. Refund claim for service tax paid in relation to export of goods.2. Rejection of refund for specific services.3. Rejection of refund based on limitation period.4. Eligibility for refund on certain charges.5. Interpretation of conditions for claiming refund under Notification 41/2007 ST.Issue 1: The appellants filed a claim for refund of service tax paid for services availed in exporting rayon tyre cord fabric. The Original Authority partially sanctioned the refund, but a portion was rejected. On appeal, the rejection was upheld. The Ld. Counsel argued that the rejected amount pertained to specific services, including GTA services and movement of empty containers. The Tribunal noted that the transport documents contained necessary details for proper linkage, making the refund claim valid. Additionally, it clarified that service tax paid for the movement of empty containers in relation to export is eligible for refund, citing relevant case laws.Issue 2: Another portion of the refund was rejected based on a limitation period. The appellant contended that the claim was filed within the time limit as it was submitted after payment of service tax on reverse charge basis. The Tribunal analyzed the conditions under Notification 41/2007 ST, emphasizing that the right to claim refund arises upon payment of service tax. Referring to precedent cases, it concluded that the limitation period should be calculated from the date of such payment, ensuring claims filed within this period are considered timely.Issue 3: An amount was rejected due to the nature of charges incurred, specifically Terminal Handling Charges (THC) and documentation charges. The appellants failed to provide evidence attributing these charges to port services. The Tribunal clarified that THC and documentation charges within the port area for services related to exporting goods are eligible for service tax refund, citing relevant case laws to support this position.Issue 4: The Tribunal found the impugned order of rejection unsustainable and remanded the case back to the Original Authority for a fresh decision based on the observations made. The appellants are to be heard before a new decision is taken. The appeal was disposed of accordingly, emphasizing the need for a reconsideration of the refund claim.