TaxTMI 
TaxTMI 
2026 (1) TMI 486
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....hat the Assessee is engaged in the business of providing logistics, transportation and supply chain management services to its customers located both within and outside India; is also holding valid Importer Exporter Code. The Assessee has claimed which is also undisputed by the Revenue that it undertakes large-scale logistics and transportation projects requiring deployment of specialized equipment like cranes, trailers, hydraulic axles, trucks and machinery; and it is also an undisputed fact that such equipment constitute capital assets of the Assessee Company, who continues to hold control over or rather remain the property of the Assessee at all material times. 3. During the period under dispute, Vestas Asia Pacific A/s, Denmark undertook the setting up of a 103 MW Wind Power Project comprising 30 Wind Operated Electricity Generators in Sri Lanka and for execution of a portion of the said project, M/s.VESTAS Wind Lanka Private Limited (VWLPL), Sri Lanka [overseas entity] issued a purchase order dated 29.05.2019 to the Appellant for providing transportation and logistic services within Sri Lanka in relation to turbine equipment and parts. The scope of work under purchase order....
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.... payable as Customs Duty on reimport. This resulted in an Audit Consultative Letter dated 01.03.2021 proposing demand of IGST in respect of certain Bills of Entry. The Assessee appears to have submitted a very detailed reply to the above Audit Objections/Audit Consultative Letter contending that the original movement of goods from India to Sri Lanka did not constitute 'supply' within the meaning of Section 7 of Central Goods and Service Tax Act, 2017 read with the IGST, 2017 and, therefore, no IGST was payable at the time of export; when no IGST was payable at the very time of export the question of payment of IGST on re-import under Sl. No. 1(d) of Notification did not arise. It appears to have also explained that mere mention of LUT in the Shipping Bills could not convert a non-supply into taxable supply. Despite the above explanation, however, a pre-Notice consultation letter dated 17.03.2022 was issued proposing to demand differential duty, BCD, SWSC and IGST in respect of certain Bills of Entry in response to which, the Appellant appears to have once again filed a detailed reply in writing pointing out that the proposal itself was internally inconsistent, that the Notification....
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.... goods. Section 5 of the IGST Act, 2017 is the charging provision which prescribes levy of IGST on all inter-State 'Supply of Goods or Services or both' and the taxable event under GST is 'Supply'. Section 7 of the Central Goods and Services Tax Act, 2017 defines the 'scope of supply' and lays down that for any activity or transaction to be considered a 'supply', it must ordinarily be made for a consideration and in the course of furtherance of business, subject to certain exceptions specified Schedule-I. Mere movement of goods without consideration and without transfer of title would not therefore constitute a 'supply' unless it is specifically deemed to be so under the above Schedule-I. 10. In the case on hand, it is the case of the Appellant that the goods were moved by it to Sri Lanka on its own account, for its own use, without consideration, without transfer of ownership and without supply to any overseas entity, which, according to the Appellant was incidental to the provision of transportation services and hence, such movement may not even remotely satisfy the statutory definition of 'supply'. In fact, vide clarification issued by CBIC in its Circular No. 80/54/2018-GST ....
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....lanation which also stands reproduced in the bullets which we also have extracted herein above, in this very paragraph, that the same is done because there was provision to mention 'non-taxable supplies' in the said column. It is, however, not the case of the Commissioner that the Appellant was wrong or that there was some other mode available for mentioning 'non-taxable supplies'. Hence, the counter by the Appellant, and rightly so, that the approach was fundamentally flawed since any tax liability could not be created by procedural declarations or system-driven requirements; the existence or mention of 'Letter of Undertaking' could never determine the taxability of a transaction since what is necessarily relevant and determinative is whether the transaction falls within the charging provisions or not. When the charging provision itself is not attracted, the compliance or non-compliance with requirements would naturally become irrelevant. Hence, it is our view that the movement of goods from India to Sri Lanka did not constitute a 'supply'. In view of the above, there would be no levy under IGST at the time of export and consequently, the very foundation for application of Sl. No.....
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....observe from the Order-in-Original is that the Department is fastening the duty liability by invoking Sl. No.1(d) of the Notification; the same refers "Goods exported under bond without payment of integrated tax" which is to the extent "as is in excess of the amount indicated in the corresponding entry in column (3) of the table." - which is amount of integrated tax not paid. That being so, even by Sl. No.1(d) demanding inter alia, BCD, is glaringly contrast, which is not all flowing from the Notification. 16. Notification No.45 [supra] which is the parent exemption-notification clearly provides under Sl. No. 5 that goods exported otherwise than by way of supply may be re-imported within a period of three years from the date of export. We have also perused the said Notification which is placed on record before us. The same however, does not prescribe the time limit of six months under Sl. No.5 as held in the impugned order. In any case, it is a settled position of law that a circular cannot override, amend or curtail the scope of a statutory Notification. In fact, the Apex Court in the cases of Commissioner of Central Excise, Bolpur Vs Ratan Melting & Wire Industries [2008 (231)....
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.... 4 on admitted facts. Thus, when we observe that the export of goods in question did not constitute 'supply' and was not a 'zero-rated supply', the same is sufficient to take the case away from the mischief of Sl.No.1(d) of Notification. 20. In Dilip Kumar's case (supra), the Hon'ble Apex Court has clarified in very simple terms that where there is ambiguity in an Exemption Notification, the benefit must go to the Revenue. However, where the language of the notification is clear and unambiguous, it must be given effect to as such. In the present case, Sl. No. 5 of Notification is very much clear in its terms; it applies to goods exported otherwise than by way of supply which are re-imported within three years. The Adjudicating Authority has not demonstrated nor is there any whisper about any ambiguity in this entry; rather the Authority has sought to deny the benefit by artificially classifying the transaction under a different serial number based on a minor aspect. Further, in Union of India And Ors. Vs Wood Papers Ltd. And Anr. [1991 AIR 2049 :(1991) 33 ECR 235] the Hon'ble Apex Court has held that the strict interpretation would apply at the stage of determining the eligibili....
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.... relating to export of materials/goods, re-import of the same, ownership of materials/goods, purpose of export, time or period of reimport and the claim of exemption have been disclosed through statutory documents [like Shipping Bills, Bills of Entry and accompanying declarations] based on which only the Department negatived the exemption claim for nonfulfilling of Notification; it cannot therefore be said to have played fraud or suppression. Moreover, even there is no dispute as to mentioning of 'LUT' in the very Shipping Bills which also remain disclosed so glaringly, which is available right from the beginning. The trigger point was only the misinterpretation of 'supply' and the exemption claimed relevant/applicable Notification No. 45/2017 ibid. Therefore, invoking extended period of limitation in such a situation is unwarranted and as propounded by the Hon'ble Apex Court in Pushpam Pharmacuetical Company Vs CCE Bombay - 1995 (78) ELT 401 (SC), Anand Nishikawa Company Ltd. Vs CCE Meerut - 2005 (188) ELT 149 (SC); Uniworth Textile Ltd. Vs CCE Raipur - 2013 (288) ELT 161 (SC) and Continental Foundation Joint Venture Holding Vs CCE Chandigarh - 2007 (216) ELT 177 (SC). The Hon'ble....