TaxTMI 
TaxTMI 
2017 (6) TMI 364
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....s allowed by the original adjudicating authority partly by way of cheque and partly by way of re-credit in Cenvat account. Aggrieved, department filed an appeal before the Commissioner (Appeals), on the ground that out of the refund amount sanctioned Rs. 40,265/- is not eligible since that portion relates to services rendered to SEZ and such services are only exempted and not export of services. Appeal of the department was allowed by the Commissioner (Appeals) vide the impugned order dated 29.07.2016, on the ground interalia that the appellants have not followed the procedures laid down in Notification No.17/2011-ST dated 01.03.2011. Hence, this appeal before this forum. 2. Today, when the matter came up for hearing, Id. Advocate Shri A....
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....he issue in dispute, it would be helpful to reproduce the relevant portion of the said Rule 5 of the Cenvat Credit Rules, 2004:- "RULE [5. Refund of CENVAT Credlt. - (l) A manufacturer who clears a final product or an intermediate product for export without payment of duty under bond or letter of undertaking, or a service provider who provides an output service which is exported without payment of service tax, shall be allowed refund of CENVAT credit as determined by the following formula subject to procedure, safeguards, conditions and limitations, as may be specified by the Board by notification in the Official Gazette : Refund amount = (Export turnover of goods + Export turnover of services) Total turnover x Net CENVAT ....
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....laim is filed. (2) This rule shall apply to exports made on or after the 1^st April, 2012 . Provided that the refund may be claimed under this rule, as existing, prior to the commencement of the CENVAT Credit (Third Amendment) Rules, 2012, within a period of one year from such commencement : Provided further that no refund of credit shall be allowed if the manufacturer or provider of output service avails of drawback allowed under the Customs and Central Excise Duties and Service Tax Drawback Rules, 1995, or claims rebate of duty under the Central Excise Rules, 2002, in respect of such duty; or claims rebate of service tax under the [Service Tax Rules, 1994] in respect of such tax. Explanation 1. - For the purposes of this rule,....
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....es or inputs, as the case may be, used in providing such service and the rebate shall be allowed subject to such safeguards, conditions and limitations, as may be specified, by the Central Government, by notification.] 7.1 As per Section 53 of SEZ Act, 2005, the SEZ territory is to be treated as territory outside the customs territory of India. Further, according to the SEZ Act 2005, supply of goods from DTA to SEZ constitutes exports. As per Section 51 of the SEZ Act 2005, the provisions of the Act will have overriding effect over the provisions of any other law in case of any inconsistency. This position has been confirmed by the CBEC through Circular No.1001/8/2015-CX8 dated 28.04.2015. 7.2 In the event, for the purposes of Rule 6 ....
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....ment for the service had been received in advance prior to the date of issue of the invoice." 7.5. Ld. AR states that although in this Notification No.27/2012-CE (NT) dated. 18.06.2012, substitution has been made w.e.f. 01.03.2016, basic principle of foreign exchange will definitely be an important requirement even for the prior period. At this point, Id. Advocate confirms that they have indeed received the amount in foreign exchange. 8. Viewed in the totality of the discussions as above, in my considered opinion, export of such services to SEZ will necessarily have to be treated as deemed export and will be eligible for refund of accumulated credit under Rule 5 of CCR and notifications issued thereunder subject to the various conditi....