2017 (10) TMI 24 - AT - Service Tax

Tribunal grants refund to service provider for service tax under reverse charge mechanism

M/s VST Industries Ltd. Versus CCE, C & ST, Hyderabad

M/s VST Industries Ltd. Versus CCE, C & ST, Hyderabad - TMI Issues:Rejection of refund claim under Notification No. 17/2009 for services under reverse charge mechanism.Analysis:The appeal addressed the rejection of a refund claim by the appellant for services under the reverse charge mechanism. The appellant, a service provider who exported goods, hired a commission agent abroad and discharged service tax liability under reverse charge mechanism. The dispute arose as the tax discharged was for business auxiliary services not listed in Notification No. 17/2009. The lower authorities denied the refund claim under Notification No. 17/2009, stating it was not applicable to the services rendered. The appellant argued reliance on a previous case where the refund was allowed under similar circumstances.The Tribunal examined the submissions and found no dispute regarding the export of goods and service tax payment under reverse charge mechanism. It was noted that the appellant applied for a refund under Notification No. 17/2009 instead of Notification No. 18/2009, which was applicable. The lower authorities concluded the appellant did not meet the conditions of Notification No. 18/2009 for the refund. However, the Tribunal observed that the first appellate authority did not specify which conditions were not fulfilled by the appellant to deny the refund. Reference was made to a previous case where procedural lapses were deemed condonable if export and tax payment were established.The Tribunal emphasized the importance of following precedent and held that the appellant was eligible for a refund based on the settled issue. It was noted that the distinctions raised by the Departmental Representative were not applicable to the current case. Consequently, the impugned order rejecting the refund claim was set aside, and the appeal was allowed.