TaxTMI 
TaxTMI 
2018 (4) TMI 911
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....including exploration and production of mineral oil and natural gas in various blocks under a Production Sharing Contract signed with the Govt. of India in respect of each block. They are also registered holders of Service tax Registration No. AAACR5055KST016. The appellants have filed claim of Refund for service tax paid for the month of October 2011 to March 2012 on the services of Survey and exploration of minerals vide GR-7 challan Nos. 819, 826, 836, 841, 846, 850 all dated 05.11.2011, 900, 981, 989, 999, 1006, 1018 all dated 05.12.2011, 803, 808, 815, 820 all dated 06. 01.2012, 666, 672, 747 all dated 06.02.2012, 697, 700 both dated 06.03.2.012, 1051, 1064 both dated 30.03.2012 on the grounds, inter alia, that :-- (i) In connection with exploration and exploitation activities, various services like seismic survey, data acquisition and processing, well bore survey, core analysis, casing and tubing, mud logging, directional/horizontal drilling, mud engineering service, erection/installation service etc. were received at various offshore locations including Continental Shelf/Exclusive Economic Zones of India provided by the Foreign Service contractors. (ii) The above menti....
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....y defining "India" in a particular manner only for the purpose of the said IOS Rules, does not appear to indicate that the term "India" does not exclude the entire Continental Shelf and Exclusive Economic Zone of India as stated by the appellants. It only states that the definition "India" includes the constructed installations, structures and vessels located in the said area and there is no exclusion of the entire Continental Shelf and Exclusive Economic Zone of India provided to the above stated amendment made to the IOS Rules. 3.2 Accordingly, a Show Cause Notice bearing F. No. LTU/MUM/CX/GLT-3/RIL/refund-ST/124/2012 dated 30.11.2012 was issued to the appellants requiring them to show cause as to why the subject refund claim should not be rejected on the grounds mentioned therein. 2.3 The aforesaid SCN was adjudicated upon by the Adjudicating authority vide Order-in-Original no. LTU/MUM/CX/GLT-3/ RIIL Ghansoli/R-90/2013 dated 30-11-2012 issued from F No. LTU/MUM/CX/GLT-3/RIL/Refund-ST/124/2012; who after considering the submissions made by the appellants concluded that the payment of service tax amounting to Rs. 4,14,45,274/- made by the appellants under reverse charge mec....
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....ndia 1987 (28) E.L.T. 39 (S.C.) para 12 has held that ".. He frankly stated that he was unable to point out any provision in the Act into which the inclusive definition could be read. We cannot attribute redundance to the legislature particularly in the case of a definition in a taxing statute. We must proceed on the basis that such a definition is designed to achieve a result. Under Section 12 of the Customs Act what are dutiable are goods imported into or exported from India and if goods are defined to include vessels, aircrafts and vehicles, we must take it that the object of the inclusive definition was to bring within the net of taxation vessels, aircrafts and vehicles which are imported into India.... ." 1.2.1 Moreover the word 'includes' has been time and again interpreted by the Apex Court to conclude that the word 'includes' cannot be given a restrictive meaning, Hon'ble Supreme Court in case of Ramala Sahkhari Chini Mills 2010 (260) E.L.T. 321 (S.C.), in para 15. The above observation of the Honb'le Supreme Court has been referred to the Larger bench of the Apex Court, while answering the reference Hon'ble Court has held that "The answer to the question referred, ac....
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....efinition of 'India' to the extent and purposes as defined in Notification No. 14/2010. Any further interpretation in the definition of India to give it a colour of an exemption notification is unwarranted and without any basis. Thus, when there was no requirement to seek or ascertain the meaning of the word "India" in the said Rules the impugned order has grossly erred to attempt the same. 2.3 As per Export of Services Rules, 2005 an amendment was carried out by the Notification No 6/2010 dated 27.02.10 to substitute the definition of India in Explanation to Sub Rule 3(2) (b) of the said Rules to read "India " as 'Explanation. - For the purposes of this rule "India" includes the installations structures and vessels located in the continental shelf of India and the exclusive economic zone of India, for the purposes of prospecting or extraction or production of mineral oil and natural gas and supply thereof. Export of Services Rules 2005 mandate the conditions which when satisfied qualify a service to be Export. One of the Conditions mentioned for the service to qualify as export was that either the service recipient or the performance of the service has to be outside India. ....
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....ed a business or has a fixed establishment from which the service is provided or to be provided or has his permanent address or usual place of residence, in a country other than India, and b) Received by a person (hereinafter referred to as the recipient who has his place of business, fixed establishment, permanent address or usual place of residence, in India, such service shall, for the purposes of this section, be taxable service and such taxable service shall be treated as if the recipient had himself provided the service in India, and accordingly all the provisions of this Chapter shall apply. Thus, if the service provider satisfies any of the conditions specified in column 1 of the table given below and the service receiver satisfies any conditions specified in column 2 of that table, such a service shall be deemed to be a taxable service and such taxable service shall be treated as if the service receiver had himself provided the service in India:- Column 1 Column 2 • Has established a business in a country other than India (or) • Has his place of business in India, (or) • Has fixed establishment from which the service....
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....one of India is liable to Service Tax under Section 66A. 5.1 In view of the details argue, the impugned order are set aside and refund claim filed be rejected. 6. Learned Counsel appearing on behalf of the respondent submits as under:- * "The Respondent is engaged in the business of exploring & producing oil and natural gas in various offshore blocks located interalia in the Exclusive Economic Zone (EEZ) of India. These offshore blocks were allotted to the Respondent under various licenses issued by the Government of India. * In connection with Gas exploration and exploitation activities at these offshore blocks located in the EEZ of India, the Respondent contracts for and procures from various foreign service contractors, a large variety of services like seismic survey, data acquisition and processing, well-bore survey, core analysis, casing and tubing, mud logging, directional/horizontal drilling, mud engineering service, erection & installation services etc. * If Payment for such services is made by the Respondent in foreign exchange, service tax liability on such services, if taxable, was required to be made by the Respondent under the Reverse Charge Mechanism in....
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....ction of such installations, structures or vessels (hereinafter described as "pre-construction services") or those services which were received for construction of such installations, structures or vessels in CS and EEZ (hereinafter referred to as "for construction services") were not regarded as services 'received in India' for the purposes of IOS Rules and therefore, not liable to Service Tax in the hands of a service recipient under the Reverse Charge provisions in Section 66A of the FA. An affirmation of this understanding was sought by the Respondent from the Department in the above letter. * Since the Respondent did not receive any response from the Department to its above letter, it deposited service tax of Rs. 4,14,45,274/- for the period October 2011 to March 2012 on "pre-construction" and "for construction" services received by it from service providers located outside India. Since, according to the Respondent, the said services were not liable to service tax and service tax had been paid there on under protest, it filed a refund application. * An SCN dated 30.11.2012 was issued to the Respondent proposing to reject the refund claim on the following two grounds - ....
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....d before the Apex Court and appeal has been admitted. In view of the legal position that both the order of the Tribunal in the respondent's own case have been challenged and admitted by higher judicial forum, hence orders are Jeopardy hence cannot be relied upon. 8. On careful consideration of the submissions made by both sides, it is noticed that the issue as narrated in paragraph number 2 is undisputed; respondent had filed claim of refund of Service Tax paid for the period October, 2011 through March, 2012 on the services of survey and exploration of minerals under reverse charge mechanism. 8.1 Learned Departmental Representative had contested the findings recorded by the first Appellate Authority as summarised hereinabove. We find the learned Departmental Representative has not disputed the fact that identical issue in respect of very same assessee-respondent was considered by this Bench in appeal No. ST/805-8015/12-Mum and by a final order dated 14.11.2013 held that the services on which tax has been discharge on reverse charge mechanism is not taxable. The period which was being considered in this appeal pertains to post 27.02.2010 more specifically for the period 28.02....
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....llations, structures and vessels within the continental shelf and the exclusive economic zone of India, constructed for the purposes of prospecting or extraction or production of mineral oil and natural gas Any service provided or to be provided by or to such installations, structures and vessels and for supply of any goods connected with the said activity." On the same day, vide Notification No. 16/2010-S.T., dated 27-2-2010, amended the provisions of the Taxation of Service (Provided from Outside India and Received in India) Rules, 2006. The relevant Notification is reproduced below:- "Notification : 16/2010-S.T., dated 27-2-2010 Taxation of Service (Provided from Outside India and Received in India) Rules, 2006 - First amendment of 2010 In exercise of the powers conferred by Sections 93 and 94, read with section 66A of the Finance Act, 1994 (32 of 1994), the Central Government hereby makes the following rules further to amend the Taxation of Services (Provided from Outside India and Received in India) Rules, 2006, namely:- 1. (1) These rules may be called the Taxation of Services (Provided from Outside India and Received in India) Amendment Rules, 2010. (2) ....
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....tinental shelf of India and the exclusive economic zone of India are not liable to Service Tax on reverse charge mechanism. As such only such activities which are consumed at the constructed installations, structures or vessels located in continental shelf of India and the exclusive economic zone of India were taxable under the reverse charge mechanism. 10. We find that in the impugned order, the Commissioner (Appeals) rejected the contentions of the appellants on the ground that by virtue of Notification 14/2010-S.T., dated 272-2010, all services provided in the CS and EEZ becomes taxable as long as they are related to any activity prospecting, extraction or production of mineral oil and natural gas hence the pre-construction services are liable to Service Tax on reverse charge mechanism. The Commissioner (Appeals) further held that in respect of construction service, Notification 16/2010-S.T., dated 27-22010 is to be construed in the light of the fact that it was issued only to bring about consequential change to the Taxation of Services (Provided from Outside India and Received in India) Rules, 2006 pursuant to the extension of the provisions of the Finance Act to whole of th....
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....pute is in respect of services for pre-construction activity and for construction activity and the appellant received taxable services from the foreign service provider. 13. In view of the above discussion, we find that as the appellant had not provided any service regarding which the appellant had paid Service Tax on reverse charge mechanism in respect of any service provided or to be provided by or to such installations, structures and vessels or for supply of any goods connected with such activity to installations, structures and vessels within the continental shelf and the exclusive economic zone of India. Therefore, the impugned order is set aside and the appeals are allowed." 8.3 It can be noticed from the above reproduced ratio of the decision of the Tribunal in the respondent's own case; the issue is now settled by Tribunal in their favour. It was the submission of the learned Departmental Representative that this order of the Tribunal is in challenged and has been admitted by the Apex Court, hence the ratio cannot be relied on. This submission of the learned Departmental Representative will not carry the case of Revenue any further. On specific query from the Bench a....