Refund Claim Denied for Service Tax on SEZ Input Services Deemed Unjustified

The denial of the refund claim for Service Tax paid on input services used in SEZ units for authorized operations was deemed unsustainable. The Member (Judicial) held that the Revenue did not contest the services' usage for SEZ operations, making the denial based on lack of documents unjustified. The judgment emphasized that SEZ Act provisions should prevail over other laws, and approval from the UAC of SEZ was procedural, not mandatory. With consistent support from co-ordinate Benches, the impugned order was overturned, allowing the appeals with consequential benefits as per law.

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Issues Involved:
Whether the denial of refund claim of the Service Tax paid on input services used by the appellant in its authorized operations in SEZ units is correctRs.

Analysis:
The judgment revolves around the denial of a refund claim for Service Tax paid on input services used in SEZ units for authorized operations. The appellant argued that the services availed, including Rent-a-Cab Service, Business Support Service, Accommodation Service, and Travel Agent Service, are essential for authorized operations as per the Uniform List of Services. The appellant relied on various CESTAT decisions to support their claim that input services used for SEZ operations should be allowed, even if not explicitly listed. The Revenue, represented by the Departmental Representative, supported the lower authorities' findings.

The Member (Judicial) considered the arguments and held that the Revenue did not dispute the usage of services for SEZ operations. Therefore, denying the refund due to lack of documents was deemed unsustainable. Referring to the case of M/s. Mast Global Business Services India Pvt. Ltd., the Member noted that rejecting refund claims on grounds beyond the show-cause notices was impermissible. The Member emphasized that the SEZ Act's provisions should override other laws, making the approval from the UAC of SEZ a procedural, not mandatory, requirement. Consistent views from co-ordinate Benches supported the appellant's stance.

Consequently, the impugned order was set aside, and the appeals were allowed with any consequential benefits as per law. The judgment highlights the importance of considering SEZ-specific regulations and the necessity of input services for authorized operations, ultimately leading to the favorable outcome for the appellant.

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