TaxTMI 
TaxTMI 
2017 (6) TMI 1109
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.... Park of India (STPI) as a 100% Export Oriented Unit (EOU). Appellants have filed refund claim for Rs. 4,81,361/- for the period January 2013 to March 2013 being unutilised CENVAT credit paid on inputs services used for providing the output services exported under Rule 5 of CENVAT Credit Rules (CCR), read with Notification No.5/2006-CE dated 14.3.2006 as amended from time to time. The refund claim was rejected by the Assistant Commissioner on the ground that as per FIRCs, the payment is received in Indian rupees and hence Rule 3(2)(b) of Export of Service Rules, 2005 is not satisfied. Aggrieved by the said order, the appellant filed appeal before the Commissioner (A) on the ground that the realisation is in foreign exchange so as to protect from the exchange rate fluctuations for which their bankers had been instructed by them to convert foreign exchange realisation into Indian rupee and credit to their account. The Commissioner (A) upheld the order of the lower authority and rejected the appeal and hence, the present appeals. 3. Heard both the parties and perused the material on record. 4. Learned consultant for the appellant submitted that the impugned order rejecting the r....
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....Rules, 2005. 6. After considering the submissions of both the parties and perusal of the material on record, and the various judgments relied upon by the appellant, I find that this issue has been considered by various Benches of the Tribunal and it has been held consistently held that merely because payment is received in Indian rupee, it cannot be said that payment against export has not been received in convertible foreign exchange as provided in Export of Service Rules, 2005. Since the Indian rupee is received from the recipient of services through their foreign bank, Silicon Valley Bank of USA, the receipt of Indian rupee shall be treated as convertible foreign exchange. Further, it is also clearly certified in the FIRC issued by the Standard Chartered Bank that remittances are in convertible foreign exchange. In the case of CST vs. PMI Organization Centre Pvt. Ltd. cited supra, the Tribunal in Para 6 has observed as under: "6. From the records, I find that it is apparent that except two invoices No. 10/2009 dated 31/10/2009 and 11/2009 dated 31/11/2009 in all other cases refund were filed within one year from the date of receipt of foreign remittance towards servi....
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....bove provision it is clear that Foreign Inward Remittance Certificate (FIRC) is issued only in respect of foreign exchange. In the present case, FIRCs were issued and there is a specific certification that the payment has not been received in non-convertible rupees, which establishes that the payment received and mentioned in the FIRCs are other than non-convertible foreign exchange, in other words, the payment is in convertible foreign exchange. I have gone through the Notification No. FEMA 9/2000-RB dated 3rd May, 2000, the relevant para No.4 of the said Notification is reproduced below: "4. Manner of Repatriation :- (1) On realisation of foreign exchange due, a person shall repatriate the same to India, namely bring into, or receive in, India and- (a) sell it to an authorised person in India in exchange for rupees; or (b) retain or hold it in account with an authorised dealer in India to the extent specified by the Reserve Bank; or (c) use it for discharge of a debt or liability denominated in foreign exchange to the extent and in the manner specified by the Reserve Bank. (2) A person shall be deemed to have repatriated the r....
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....ion as mentioned in the declaration form irrespective of the country of residence of the buyer." 7. From the above regulation and serial No. (2) of the Table, it is very clear that the payment in rupees from the account of a bank situated in any country (other than a member country of Asian Clearing Union or Nepal or Bhutan) is a manner of receipt of foreign exchange. In the present case, as evident that the Indian rupees was received thru the account of Deutsche Bank which is situated in foreign country. Therefore, in terms of Regulation 3 made under Section 47 of the Foreign Exchange Management Act, 1999, in the present case the foreign remittance in Indian rupees through Deutsche Bank is the receipt of payment in convertible foreign exchange. 8. I have gone through the hon'ble Supreme Court's judgment in the case of J.B. Boda a nd Company (supra) wherein it was held that: "12. The facts brought out in this case, are clear as to how the remittance to the foreign reinsurance company is made through the Reserve Bank of India in conformity with the agreement between the appellant and the foreign reinsurer, and that the remittanc....
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....nt due to the foreign insurer shall be treated as foreign exchange. In view of the above judgment, I am of the view that when a foreign bank is maintaining Indian rupees in their account obviously, such Indian rupees was obtained in lieu of foreign exchange. For example, if any payment is made from India to any foreign country, it is to be made in foreign exchange and thus there is a outflow of foreign exchange but if the payment is made in Indian rupees, there is a saving of foreign exchange and if the said Indian rupees is received in India, the same is in lieu of foreign exchange which was saved at the time of repatriation of Indian rupees to foreign country. On this logic under the Foreign Exchange Management Act also it provided that if the payment in India rupees is received in India through banking channel it is deemed to be convertible foreign exchange. 10. As regard the judgments relied upon by the learned counsel, I have gone through the same. However, same are need not be discussed, in view of my above discussion and the statutory provisions of the Foreign Exchange Management Act and hon'ble Supreme Court's judgment, I am of the considered view that even....