2024 (6) TMI 445 - AT - Service Tax

Service tax refund of Rs.30,68,750 with 12% interest granted on export pass fee following precedent

M/s Bajaj Hindusthan Sugar Ltd. Versus Commissioner of CGST, Meerut

CESTAT Allahabad allowed the appeal regarding refund of service tax on export pass fee. The Tribunal held that the appellant was not liable to pay service ... Refund of service tax - export pass fee - Reverse charge mechanism - rejection of refund claim on the ground that service tax on the export pass fee is payable as per N/N. 30/2012-S.T. dated 20.06.2012 as amended vide N/N. 18/2016-5.1. dated 01.03.2016 w.e.f. 01.04.2016 - HELD THAT:- The Tribunal after relying upon the case of Anheuser Busch Inbev India Ltd. vs. CCT Bengaluru North West [2021 (2) TMI 1023 - CESTAT BANGALORE] held that the Appellant is not liable to pay service tax on Export Pass Fee. Thus, the fees paid by the Appellant to the State Government does not amount to the provision of any service. The impugned order passed by the learned Commissioner (Appeals) is set aside and the appeal is allowed. The Adjudicating authority is directed to grant refund of Rs.30,68,750/- and also interest upon the said amount, from the date of deposit till the date of grant of refund @ of 12% per annum. Such refund and interest should be granted within a period of Ninety days from the date of receipt of copy of this order. Issues:Refund of service tax on Export Pass Fees paid to State Excise Department for getting export permit.Analysis:The Appellant, engaged in the manufacture of Cane Sugar, Molasses, and Alcohol, paid Anugya Patra Shulk/Export Pass Fees to the State Excise Department for export permit clearance. The Appellant inadvertently paid service tax on the Export Pass Fees, which the buyer did not reimburse. A refund application was filed, but a Show Cause Notice was issued proposing rejection based on Notification No.30/2012-S.T. The Appellant argued that service tax was not payable, citing a judgment quashing a similar fee by the Hon'ble Allahabad High Court. The Adjudicating Authority and Commissioner (Appeals) rejected the claim, leading to an appeal.The Authorized Representative reiterated the impugned order, but the Appellant argued that service tax was not applicable, referencing a Tribunal decision in a similar case. The Tribunal, in the case of Anheuser Busch Inbev India Ltd., held that certain fees were not subject to service tax, quoting relevant provisions and case law. The Appellant contended that the fees paid did not constitute a service, supported by various legal precedents and legislative provisions.Based on the above discussion and following the Tribunal's decision in Anheuser Busch Inbev India Ltd., the Appellant was found not liable to pay service tax on Export Pass Fees. The Appellant's reliance on judgments quashing similar fees and the absence of service provision in the payments supported this conclusion. Consequently, the impugned order was set aside, and the appeal was allowed for a refund of the service tax amount with interest within ninety days.In conclusion, the Tribunal ruled in favor of the Appellant, directing the Adjudicating authority to grant a refund of the service tax amount paid on Export Pass Fees, along with interest, within a specified timeframe. The decision was based on the non-applicability of service tax to the fees paid to the State Excise Department, as established through legal analysis and precedents cited during the proceedings.