Whether the filing of the declaration in terms of notification No.12/2005 dated 19.04.2005 on 05.02.2007, after the date of the export of the services amounted to non-compliance with the condition disentitling the appellant from the rebate claims?

Notification No. 012/05-STdated -19-04-2005

Revenue rejected the refund claim stated that, Since no declaration under para 3.1 was filed and assessee did not obtain the service tax registration rebate / refund admissible."

 Honorable High Court in a decision has held that, "Any condition imposed by the notification must be capable of being complied with. If it is impossible of compliance, then there is no purpose behind it."

 See: WIPRO LIMITED Versus UNION OF INDIA - 2013 (2) TMI 385 - DELHI HIGH COURT

While deciding the issue in favor of assessee and directing the Revenue to grant rebate / refund, HC noted that:

"The correctness of this view, as a broad proposition, need not be decided in this case. The question here is one of impossibility of compliance with the requirement. If, having regard to the nature of the business and its peculiar features – which are not in dispute – the description, value and the amount of service tax and cess payable on input-services actually required to be used in providing the taxable service to be exported are not determinable prior to the date of export but are determinable only after the export and if, further, such particulars are furnished to the service tax authorities within a reasonable time along with the necessary documentary evidence so that their accuracy and genuineness may be examined, and if those particulars are not found to be incorrect or false or unauthenticated or unsupported by documentary evidence, we do not really see how it can be said that the object and purpose of the requirement stand frustrated. In the present case, no irregularity or inaccuracy or falsity in the figures furnished by the appellant both on 05.02.2007 and in the rebate claims has been alleged. Moreover, it appears to us somewhat strange that none of the authorities below has demonstrated as to how the appellant could have complied with the requirement prior to the date of the export of the IT-enabled services."

Earlier the tribunal (2011 (10) TMI 261 - CESTAT, NEWDELHI) while rejecting the appeal of the assessee has observed that,

"“The condition prescribed in para 3.1 is for the purpose of preventing the evasion of duty by misuse of this facility and, therefore, if this condition, though a procedural condition, is violated, the rebate would not be admissible."

Thus HC has reversed the order of CESTAT.

WIPRO LIMITED Versus UNION OF INDIA - 2013 (2) TMI 385 - DELHI HIGH COURT

Impossibility of compliance: post-export declarations allowed if verifiable particulars are submitted in reasonable time for rebate entitlement. Where particulars to compute input service tax for exported services are determinable only after export, strict pre-export compliance is impossible of compliance; if those particulars are furnished within a reasonable time with supporting documentary evidence and are not shown to be false or unauthenticated, rebate entitlement should not be denied on that procedural ground.