TaxTMI 
TaxTMI 
2017 (3) TMI 378
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....nd Commercial Coaching and Training Services. In terms of the Development Commissioner's Office letter dated 20.07.2011, the appellant has been permitted to receive specified services used in authorized operations w.e.f 20.07.2011 as per Notification No. 17/2011-ST dated 01 .03.2011. 2. As a SEZ unit, the appellant filed refund claim of service tax paid on specified services in terms of Notification No. 17/2011-ST dated 01.03.2011 read with Circular No. 142/1 1/2011-ST dated 18.05.2011 . In Notification No. 17/2011-ST condition 2(g) provides that no CENVAT credit of service tax paid on specified services can be taken by the SEZ unit for the authorized operations. The appellant though initially had taken CENVAT credit on the servi....
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....e claim did not cover Rs. 11,08,699/- which related to input services which appellant considered as not fully consumed within the SEZ. The appellant reversed the entire credit including the unutilized credit balance as on 31.03.2012. The appellant reversed the CENVAT credit on 01 07.2012 and informed the department on 02.05.2013 the refund claim was filed 29.04.2013. He submitted that the appellant had reversed the entire credit prior to the filing of refund claim. 4. The Ld. Counsel relied upon the judgment of the Honorable Apex Court in the case of CCE & Cus Vs. Precot Meridian Ltd., [2015 (325) ELT 234 (SC)] to canvass the proposition that even though the CENVAT credit is taken when the same is reversed by the assessee it would amount t....
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....sp; The main issue that posses for consideration before me is whether the appellants have fulfilled the condition 2(g) of the Notification 17/2011-ST when they have taken the CENVAT credit and reversed the same before filing the refund claim. One of the object of the notification is to make services to SEZ tax free. In the case of Precot Meridian Ltd., the Honorable Supreme Court had considered the issue whether the assessee can be considered to have fulfilled the substantive condition in the notification to claim the benefit of exemption when the CENVAT credit which was taken by the assessee has been reversed. The Honorable Apex Court taking note of the judgments rendered in the case of Franco Italian Co. Pvt. Ltd., Vs. Commissioner&....
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....se is set aside and the appeal of Franco Italian Company (supra) is allowed subject to the conditions that Modvat credit taken of the duty paid on the inputs which were utilised in the manufacture of duty free goods, is reversed." 18. In view of the above decision we are of the opinion that reversal of Modvat credit amounts to non-taking of credit on the inputs. Hence the benefit has to be given of the notification granting exemption/rate of duty on the final product since the reversal of the credit on the input was done at the Tribunal's stage. The relevant paragraph in the judgment of the Honorable Apex Court in Precot Meridian Ltd., is noted as under: 3. We note that five-Member Bench of the Tribunal in the case of 'Franco I....