Export service tax rebate applies to allied export services used beyond the factory, regardless of timing.
Service tax rebate under Notification No. 41/2012-ST, as amended by Notification No. 1/2016, was available for chartered accountant and allied services used in connection with exports and not confined to the factory or other place of production. The decisive test was whether the taxable services were used beyond the factory or premises of manufacture for export, and the distinction between pre-export and post-export services was held irrelevant. The services described in the certificate were found connected with export activity, and the department produced no contrary evidence. The refund claims were therefore admissible and the rejection was unsustainable.
Issues: Whether service tax paid on chartered accountant and allied export-related services was refundable under Notification No. 41/2012-ST, as amended by Notification No. 1/2016, when the services were used in connection with export and were not confined to the factory or place of production.
Analysis: The notification granted rebate of service tax paid on specified services used for export of goods. After amendment, the relevant test was whether the taxable services were used beyond the factory or any other place or premises of production or manufacture. The distinction between pre-export and post-export services was held to be irrelevant. The services described in the certificate were found to be connected with export activities and not with production of soap stone, and no contrary evidence was produced by the department. The court treated this as sufficient compliance with the notification.
Conclusion: The refund claims were admissible and the rejection was unsustainable. The answer is in favour of the assessee.
Ratio Decidendi: For rebate under the notification, the decisive criterion is whether the taxable services are used beyond the factory or premises of production or manufacture for export, not whether they are rendered before or after export.
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