TaxTMI 
TaxTMI 
2022 (8) TMI 1557
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....n, which I find the appellant failed to do so. Hence, the applicant has failed to meet out the basic mandatory requirement for claiming refund of service tax that is the approval. This is mandatory requirement and not procedural lapse which is condonable. ............... ................ ORDER I hereby uphold the impugned Order in Original No. 04/2014/Refund/ST/Dn. Mihan dated 24.03.2015 passed by the Assistant Commissioner, Central Excise, Customs & Service Tax, Division Mihan, Nagpur, and reject the appeal of the appellant." 2.1 This appeal was earlier heard by this Tribunal and the Tribunal had vide its final order No. A/87886/2016-WZB/SMB dated 10.06.2016 dismissed the appeal filed by the appellant observing as follows:- "4. I have gone through the rival submissions. I find that in the case of Mahindra Engineering Services (supra), cited by the counsel, the argument that the said notification is an exemption notification and therefore, at the time to avail the exemption, the conditions of notification have to be fulfilled, was not taken by the Revenue. In the instant case, I find that the Notification No. 12/2013 provides the exemption by way of ref....
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....an earlier adjudication made on merits. It would be open for the Tribunal in subsequent proceedings to doubt the correctness of the view earlier taken and refer the question to a Larger Bench but it would not be permissible to disregard the earlier view on the ground that a particular contention was not raised when the earlier order was passed. 6. Since we prima facie find that the appellant was justified in relying upon the earlier decision of the Tribunal in Mahindra Engineering Services Ltd. (supra) and that the Tribunal was not justified in disregarding its earlier order, we find that reconsideration of the proceedings by the Tribunal is warranted in this backdrop. Accordingly the substantial question of law as framed is answered by holding that the Customs, Central Excise and Service Tax Appellate Tribunal ought to have considered the effect of its earlier decision in Mahindra Engineering Services Ltd. (supra). If it was of the opinion that said view required reconsideration, the option of referring that question to a Larger Bench ought to have been exercised. In view of the aforesaid answer the following order is passed : (i) The order dated 10-6-2016 passed by the Cust....
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...., learned AR submits that:- ● Notification No. 12/2013 and Notification No. 09/2009-ST dated 03.03.2009 are distinctly different from each other and hence the Tribunal was justified in dismissing the appeal in the earlier instance. Pointing out the above distinction he stated:- "(I) (A) Notification No. 12/2013 dated 01.07.2013 has a provision of exemption from payment services tax on the specified services by two way:- (i) Exemption by way of refund of Service Tax paid on the specified services received by the SEZ unit or developer and used for authorized operations. (Paragraph 2) (ii) Exemption by way of ab initio non payment of Service Tax on the specified services received by the SEZ unit or the developer and are used exclusively for authorized operation. (Proviso to Para 2) (B) whereas Notification No. 09/2009 dated 03.03.2009 has provision of exemption of service tax paid on the specified services by way of Refund only (Clause (c) of Para 1 of notification). There is no provision of ab initio exemption from payment of Service Tax. (II) (A) The exemption either by way of ab initio exemption from payment of service tax or by refund of ....
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....cations (09/2009) are applicable on the issue of refund of Service Tax only. Although, it cannot be inferred that any kind of manner or sequence is to be followed while claiming refund if all conditions are fulfilled, it appears to be logical to get an approval of specified service from approval committee prior to initiating service activity. The Courts have shown leniency and allowed refund in many cases when all the conditions are simply followed. (V) (A) The claim of refund shall be filed within one year from the end of the month in which actual payment of service tax was made. (B) The claim of refund shall be filed within 6 months from the end of the month in which actual payment of service tax was made." 4.1 I have considered the impugned order along with the submissions made in appeal and during the course of argument, as per the direction of the Hon'ble High Court. 4.2 The issue involved is not whether these services against which refund claim has been filed as per Notification No. 12/2013 were input services of the appellant for undertaking the development work in SEZ. Lower authority has allowed the refund claim in respect of the same services which were rece....
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....ect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act." Section 55 of the SEZ Act gives power to the Central Government to make rules for carrying out the provisions of the Act. In exercise of the aforesaid powers, the Central Government made "The Special Economic Zones Rules, 2006" Rule 31 deals with the exemption from payment of service tax and is reproduced below : "The exemption from payment of service tax on taxable services under Section 65 of the Finance Act, 1994 (32 of 1994) rendered to a Developer or a Unit (including a Unit under construction) by any service provider shall be available for the authorized operations in a Special Economic Zone." Further Notification No. 9/2009-Service Tax, dated March 3, 2009 reads as follows : G.S.R. 146(E) - In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994), and in supersession of the Notification of the Government of India, Ministry of Finance (Department of Revenue), No. 4/2004-Service Tax, dated the 31st March, 2004, published in the....
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....e Finance Act. Thus, when the services rendered by the appellant are fully exempted from service tax in terms of the provisions of the SEZ Act, the condition of exemption by way of refund imposed under the Notification issued under the Finance Act would be inconsistent with the provisions of the SEZ Act. It also needs to be noted that the SEZ Act was enacted in 2005, much after the enactment of the Finance Act in 1994. This issue was examined by the Telangana and Andhra Pradesh High Court in GMR Aerospace Engineering Limited and Another v. Union of India and Others [2019 (8) TMI 748 = 2019 (31) G.S.T.L. 596 (A.P.)]. The Andhra Pradesh High Court observed as follows : "22. It may be noted that sub-section (1) of section 26 begins with the words "subject to the provisions of sub-section (2)". Subsection (2) authorizes the Central Government to prescribe the manner in which and the terms and conditions subject to which exemptions shall be granted to the developer or entrepreneur under sub-section (1). 23. As rightly pointed out by Sri S. Niranjan Reddy, Learned Senior Counsel appearing for the petitioner, the word "prescribe" appearing in sub-section (2) of section 26 has ....
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....5 defines the word "prescribe" under section 2(w) to mean the rules framed by the Central Government under the SEZ Act, 2005. The space is also not left unoccupied, as the Central Government has issued a set of rules known as "the Special Economic Zones Rules, 2006", wherein the Central Government has prescribed the terms and conditions for grant of exemptions under rule 22. Therefore, there is no question of comparing the terms and conditions prescribed in rule 22 with the terms and conditions prescribed in the Notifications issued under any one of the five enactments listed in section 26(1) to find out whether there was any inconsistency. 34. The benefit of exemptions granted under the Notifications issued under section 93 of the Finance Act, 1994, are available to any one and not necessarily confined to a unit in a special economic zone. Section 93 of the Finance Act, in that sense is a general power of exemption available in respect of all taxable services. But, section 26(1) is a special power of exemption under a special enactment dealing with a unit in a special economic zone. Therefore, the Notifications issued under section 93 of the Finance Act, 1994 cannot be pressed ....
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...." in view of the definition of "prescribed" under section 2(w) of the SEZ Act. The Notification dated March 3, 2009, which has been issued under section 93 of the Finance Act, therefore, has no application." 13. Learned Authorized Representative of the Department has, however, placed reliance upon sub-rule (5) of Rule 47 of the SEZ Rules that was inserted w.e.f. August 5, 2016 to contend that the aforesaid two notifications issued under Finance Act would be applicable. This submission of Learned Authorized Representative of the Department cannot be accepted. It is by a notification dated August 5, 2016 that in Rule 47, sub-rule (5) was inserted after sub-rule (4) and the same is reproduced below : "47(5) Refund, Demand, Adjudication, Review and Appeal with regard to matters relating to authorized operations under Special Economic Zones, Act, 2005, transactions and goods and services related thereto, shall be made by the Jurisdictional Customs and Central Excise Authorities in accordance with the relevant provisions contained in the Customs Act, 1962, the Central Excise Act, 1944 and the Finance Act, 1994 and the rules made thereunder of the notifications issued thereunder." ....
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....d of Service Tax paid on input service used for authorized operations. Further, I find that as per Notification No. 12/2013-S.T., dated 1-7-2013, the only requirement is that the appellant is required to file the list of approved services which have been used by them for authorized operations. Further, in this case, I find that the appellant has subsequently obtained the approval from the Unit Approval Committee of the SEZ and the said certificate is placed on record but the Commissioner (A) has held that the said approval was obtained from the competent authority on 25-10-2011 and therefore, after the approval, he has allowed the refund and prior to that he has rejected the same. Further, I find that in view of the settled legal position by various decisions relied upon by the appellant, conditions of approval from UAC is not a mandatory requirement as per SEZ Act vide section 51 of the SEZ Act which has an overriding effect over the provisions of any other law. Further, I find that it is only a procedural requirement to get the approval from the Unit Approval Committee and is not a mandatory condition as per the SEZ Act which has an overriding effect over other laws." 16.....
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....1) but what is important to notice, and as was also observed by the Andhra Pradesh High Court, the word "prescribe" would mean "prescribed by rules made by the Central Government under the SEZ Act," in view of the definition of "prescribed" under section 2(w) of the SEZ Act. The Notification dated March 3, 2000, which has been issued under section 93 of the Finance Act, therefore, has no application." This Tribunal in the case of M/s. ATC Tyres Pvt. Ltd. v. Commissioner of GST & CE, Tirunelveli reported in 2021-VIL-106-CESTAT-CHE-ST had considered the very same issue of limitation mentioned in the Notification No. 12/2013-S.T. It was held that Section 51 of SEZ Act has an overriding effect and, therefore, the conditions mentioned in the notification cannot be applied so as to deny the refund when substantial conditions prescribed in the SEZ Act have been fulfilled." In the case of SE Forge Ltd. (supra), the Division Bench at Chennai has held as follows:- "5. The issue that arises for consideration is whether the appellant is eligible for refund of service tax paid on Renting of Immovable Property Service. The original authority has rejected the refund on the ground th....
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....EZ unit for its authorized operations. Hence, the denial of refund for want of documents is not sustainable. 6.1 The Learned Bangalore Bench of the CESTAT in the case of M/s. Mast Global Business Services India Pvt. Ltd. (supra) has considered the case of a similarly placed taxpayer and held as under: "6.1 After considering the submissions of both sides and perusal of material on record, I find that the show cause notices were issued on two grounds viz. certain input services are not covered in the definition of input service under Rule 2(l) of CENVAT Credit Rules and hence not eligible and secondly non-submission of documents required to process the claims. Further I find that Order-in-Original as well as impugned order, both have rejected the refund claims on other grounds which are not taken in the show-cause notices and therefore they have travelled beyond the show-cause notices which is not legally permissible in view of various decisions cited supra by the appellant. Further I find that the impugned order also violates the principles of natural justice because the appellant has not been given the reasonable opportunity to defend himself on the ground on which the refund....