TaxTMI 
TaxTMI 
2022 (9) TMI 1386
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.... [for short, "CBIC"] for respondent nos.2 and 3. 2. The issues involved in all the seven (7) writ petitions are one and the same. It is to be noted that W.P.Nos.11194, 11206 & 11263 of 2021 came to be filed against the order of Additional Commissioner, (GST Appeals) and W.P.Nos.11198, 17275, 28836 & 30292 of 2021 are filed against the order of Deputy Commissioner of Central Tax. 3. W.P.No.11194 of 2021, which is filed, against the order in Appeal No.GUN-GST-000-APP-001-20-21 GST, dated 30.04.2020, wherein the order rejecting refund was upheld, is taken as a lead petition for the purpose of deciding the issues involved. 4. In a nut-shell, the facts in issue, are that there was a Memorandum of Understanding for the purpose of supply of power between India and Bangladesh. The petitioner participated in the tender process floated by the Bangladesh Power Development Board [for short, "BPDB"] and was awarded contract by BPDB, pursuant to which, a Letter of Intent for purchase of 250 MW electricity power, was issued on 07.08.2018. Thereafter, the petitioner entered into a Power Purchase Agreements (PPAs) with BPDB and started supplying electricity/electrical energy to BPDB in accordanc....
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....refund of unutilized Input Tax Credit through a refund claim by filing application under Form GST RFD-01A in terms of Section 54 of CGST Act, 2017 read with Section 16(3) of IGST Act, 2017. (b) On 17.05.2019, the third respondent issued a Memo, demanding the petitioner to file (1) Copy of Input Tax Credit Register; (2) Copy of Input Tax Credit Invoices and (3) A statement containing the number and date of shipping bills or bills of exports and the number and date of the relevant export invoices. Except for the statement containing the number and date of shipping bills or bills of export, the petitioner submitted all other documents including the Regional Energy Account showing the units of electricity exported as demanded in the memo. In so far as non- submission of the shipping bill, the petitioner addressed a letter to third respondent, stating that shipping bill will not be available and there is no requirement under the Customs Law, for filing of shipping bill or any similar documents showing export of electrical energy as required for physical export of tangible goods. It is stated that generation and filing of shipping bill is not possible for transmission of electricity an....
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.... and from one country to another country is only through transmission lines. In other words, his argument is that shipping bill is a custom document and the same cannot be made applicable to show supply of Electricity; which is intangible in nature. 8. To substantiate that there was export of electricity, learned counsel for the petitioner submits that he has placed other documents (REA reports), which amply establish the same. According to him, in a meeting held on 18.02.2020, with the Ministry of Power, under the Chairmanship of the Central Electrical Authority, it was decided that monthly Regional Energy Accounts [REAs] issued by the Regional Power Committee [RPC] can be used as a document to establish proof of export in case of electricity. He also placed on record the Notification dated 05.07.2022 issued by the Government of India amending Rule 89 of CGST Rules, 2017, which gives clarification as to how the export of electricity can be proved. 9. In so far as, the second issue is concerned, learned counsel for the petitioner would contend that though in first three cases, the authorities issued show cause notice demanding proof, for export of electricity to Bheramara substat....
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....sub-station and has no dedicated International/ Cross Border Transmission lines for transmission of electricity to Bangladesh. The power is transmitted pursuant to an agreement with Central Electricity Authority under the supervision of Government of India and as such, no benefit can be given for refund of input tax credit. 12. An additional affidavit came to be filed on behalf of the second and third respondents, referring to Notification, dated 05.07.2022, amending Rule 89 of CGST Rules, 2017 and the said notification being published in the Gazette on 05.07.2022. Hence, submits that any relief to the petitioner can be extended only be after 05.07.2022 and the same cannot be retrospective in operation. 13. In the rejoinder filed by the petitioner, it is stated that the petitioner has not challenged the statutory provision, but only prays that Rule 89 of CGST Rules, 2017 requiring production of shipping bills as proof of export, is impossible to be fulfilled in their case, owing to its intangible nature. 14. The point that arises for consideration is, whether the authorities were right in rejecting the refund claim made by the petitioner? 15. Before dealing with issues involved....
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....llate authority, it would serve no useful purpose to file the same again before the same authority, by the same party, seeking the very same relief. 19. Coming to the point for consideration and to appreciate the rival arguments advanced, on the legal issues involved, it would be appropriate to refer Section 16 of IGST Act, 2017 which reads as under:- (1) "zero rated supply" means any of the following supplies of goods or services or both, namely:-- (a) export of goods or services or both; or (b) supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit. (2) Subject to the provisions of sub-section (5) of section 17 of the Central Goods and Services Tax Act, credit of input tax may be availed for making zero-rated supplies, notwithstanding that such supply may be an exempt supply. (3) A registered person making zero rated supply shall be eligible to claim refund under either of the following options, namely:-- (a) he may supply goods or services or both under bond or Letter of Undertaking, subject to such conditions, safeguards and procedure as may be prescribed, without payment of integrated tax and claim refund of unutil....
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....to transmission grid at the interconnection point located in Andhra Pradesh. The reading meters at the interconnection/injection points are erected, to record the supply of electricity by the petitioner. The injected electricity gets transmitted to Bohrompur sub-station, Murshidabad District, West Bengal [delivery point] by the Interstate transmission lines of M/s.Power Grid Corporation of India Limited. From there, it reaches Bangladesh by cross border transmission line, between Bohrompur sub-station and Bheramara sub-station of Bangladesh, through Power Grid Company Bangladesh. The material on record also shows that the actual units of electricity supplied by the petitioner to Bangladesh is recorded in Regional Energy Account, issued on monthly basis, by Southern Regional Power Committee, which is a unit of Central Electricity Authority in India. As the supply of electrical energy, is treated as zero- rated supply, under Section 16 of IGST Act, 2017, the petitioner applied for refund of unutilised input tax credit through a refund claim by filing applications in required forms. It is also not in dispute that the petitioner has generated electrical energy and transmitted through t....
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....electricity. The said issue was also raised before Regional Power Committee meeting, in which it was stated that REA reports made available by Regional Power Committee on monthly basis can be used as proof of export. It would be useful to extract the relevant portion, which is as under:- "9. After deliberations, following was concluded: a. Total energy from a generation project may be sold through a single or more than one contracts, which may include both 'export' and 'domestic sale'. b. Taxes are paid by the generators for various components of the inputs that are used in generation of electricity from their project. Therefore, the inputs need to be apportioned between 'exports' and 'domestic sale' for the purpose of allowing input tax credits. c. Regional Energy Accounts (REAs) which are made available by each Regional Power Committee (RPC) on monthly basis, provide energy scheduled under each contract from a particular generating station situated in their region. Thus, this scheduled energy as available in REA can be used for proof of export of sale. d. However, it would be better to use the variable charge component of the bills, if available separately, for proporti....
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....out of India shall be taken as - (i) the Free on Board (FOB) value declared in the Shipping Bill or Bill of Export form, as the case may be, as per the Shipping Bill and Bill of Export (Forms) Regulations, 2017; or (ii) the value declared in tax invoice or bill of supply, whichever is less."; (d) in sub-rule (5), for the words "tax payable on such inverted rated supply of goods and services", the brackets, words and letters "{tax payable on such inverted rated supply of goods and services x (Net ITC' ITC availed on inputs and input services)}." Shall be substituted;" 28. A reading of the above amendment, inter alia, makes it clear that the petitioner herein can now prove the quantity of electricity transmitted basing on the statement of scheduled energy for export of electricity issued by Regional Power Committee [RPC] Secretariat, as a part of Regional Energy Account [REA] under clause (nnn) of Sub-Regulation (1) of Regulation (2) of Central Electricity Regulatory Commission. 29. Further, the amendment to Rule 89 (2)(ba) of CGST (Amendment) Rules, 2022 [July, 2022] clearly show that the number and date of the export invoices, details of energy exported, tariff per unit of ....
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....ion relating to the products and services of the MNCs, queries relating to maintenance and after- sales services, providing telephonic assistance in case of glitches during operating the consumer-products or while utilising the services and so on. For instance, the customer sitting in USA has a problem operating a washing machine sold to him by an American company. When he calls the company, the local telephone number would be linked to the call centre number in India and it will actually be an employee of the Indian call centre who would answer the queries and assist the customer in USA get over the problem. Another example could be of a person in USA wanting to book an international air-ticket from an airline; his queries over the phone will be answered by the employee of the Indian call centre, sitting in some place in India. The American manufacturer of the washing machine or the American airline company is the source of revenue for the Indian call centre or BPO centre. 13. All the lower authorities, including the CESTAT, are unanimous in their view that the requirement, though one of procedure, is nevertheless inflexible as it is conceived with a view to preventing the evasi....
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....spondent in. her counter-affidavit. No explanation is forthcoming even now as to why the petitioner company alone is being picked upon for violation of the condition of furnishing the certificates in advance. The third respondent also does not dispute, that the certificates were produced by the petitioner company after release of the movies and there is no shortcoming or lacuna in this regard. If that is so, mere failure on the part of the petitioner company to produce such certificates in advance, which it could not have done in any event, is not a ground to deny it the benefit of G.O. Ms. No. 604 dated 22.04.2008. The assessment orders, which proceeded only on the premise that such benefit could not be extended to the petitioner company owing to belated production of the certificates, therefore cannot be countenanced." 33. In Commissioner of Customs vs. Frontier Aban Drilling (India) Limited 2010 (254) ELT 63 (Mad.) = MANU/TN/0035/2010, the Madras High Court observed as under:- "4. We have carefully considered the arguments of the learned Counsel for the appellant and perused the materials available on record as well as the orders of the lower Authorities. No such condition ha....
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....ctricity, is as under:- "Reference has been received from Ministry of Power regarding the problem being faced by power generating units in filing of refund of unutilised Input Tax Credit (ITC) on account of export of electricity. It has been represented that though electricity is classified as "goods" in GST, there is no requirement for filing of Shipping Bill/Bill of Export in respect of export of electricity. However, the extant provisions under Rule 89 of CGST Rules, 2017 provided for requirement of furnishing the details of shipping bill/bill of export in respect of such refund of unutilised ITC in respect of export of goods. Accordingly, a clause (ba) has been inserted in sub-rule (2) of rule 89 and a Statement 3B has been inserted in FORM GST RFD-01 of the CGST Rules, 2017 vide notification No.14/2022- CT dated 5th July, 2022. In order to clarify various issues and procedure for filing of refund claim pertaining to export of electricity, the Board, in exercise of its powers conferred by Section 168(1) of the CGST Act, hereby prescribes the following procedure for filing and processing of refund of unutilised ITC on account of export of electricity." The above Circular clea....
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....ated above, should be read as retrospective. In fact, in J.H. Gotla case [supra 6 cited], the Hon'ble Supreme Court observed:- "We should find out the intention from the language used by the Legislature and if strict literal construction leads to an absurd result, i.e., a result not intended to be subserved by the object of the legislation found in the manner indicated before, then if another construction is possible apart from strict literal construction, then that construction should be preferred to the strict literal construction. Though equity and taxation are often strangers, attempts should be made that these do not remain always so and if a construction results in equity rather than in injustice, then such construction should be preferred to the literal construction." 44. The Constitutional Bench of Hon'ble Supreme Court in Commissioner of Income Tax vs. Vatika Township Private Limited (2015) 1 SCC 1 while deciding the question as to whether the insertion of proviso to Section 113 by Finance Act, 2002 is retrospective, discussed the general principles concerning retrospectivity. The Hon'ble Supreme Court observed as under:- "30. We would also like to point out, for the ....