TaxTMI 
TaxTMI 
2026 (1) TMI 780
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.... On adjudication, an amount of Rs.2,48,485/- was sanctioned and the balance amount of Rs.85,18,556/- was rejected. Aggrieved by the said order, they filed an appeal before the learned Commissioner (Appeals) who in turn rejected the appeal. Hence, the present appeal. 3. At the outset, the learned advocate for the appellant has submitted that the appellant has Special Economic Zone units located at Chennai, Pune, Mangalore, Hyderabad and Chandigarh in terms of provisions of Special Economic Zone Act, 2005 read with relevant rules. They have obtained Centralised Service Tax Registration in respect of all its units including SEZ units. During the period of dispute, the appellant as an SEZ unit received various taxable services on payment of service tax for authorised operations in SEZ and consequently filed refund claim of Rs.87,67,041/- in terms of SEZ provisions. It was filed within time limit. A part of the refund claim was rejected on the ground that it pertains to taxable services which were "wholly" consumed in SEZ and accordingly refund was not eligible under Notification No.9/2009-ST as amended. He has submitted that this issue is no more res integra and covered by the judgm....
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....conomic Zone or from a Unit, to any place outside India: (c) exemption from any duty of excise, under the Central Excise Act, 1944 or the Central Excise Tariff Act, 1985 or any other law for the time being in force, on goods brought from Domestic Tariff Area to a Special Economic Zone or Unit, to carry on the authorised operations by the Developer or entrepreneur; (d) drawback or such other benefits as may be admissible from time to time on goods brought or services provided from the Domestic Tariff Area into a Special Economic Zone or Unit or services provided in a Special Economic Zone or Unit by the service providers located outside India to carry on the authorised operations by the Developer or entrepreneur; (e) exemption from service tax under Chapter-V of the Finance Act, 1994 on taxable services provided to a Developer or Unit to carry on the authorised operations in a Special Economic Zone; (f) exemption from the securities transaction tax leviable under section 98 of the Finance (No. 2) Act, 2004 in case the taxable securities transactions are entered into by a non-resident through the International Financial Services Centre; (g....
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....f Special Economic Zone claiming the exemption actually uses the specified services in relation to the authorised operations in the Special Economic Zone; (c) the exemption claimed by the developer or units of Special Economic Zone shall be provided by way of refund of service tax paid on the specified services used in relation to the authorised operations in the Special Economic Zone; (d)..... (e)..... (f)...... 2 .................. 3. The exemption contained in this notification shall apply only in respect of service tax paid on the specified services on or after the date of publication of this notification in the Official Gazette. 6.3 The Notification No.15/2009-ST dated 20.5.2009 amends the Notification No.9/2009. The relevant parts of this Notification are given herein below: Notification No. 15/2009-Service Tax dated 20-May-2009 Exemption to taxable services provided to a developer or unit of Special Economic Zone Notification No.9/2009-S.T., amended In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994), the Central Government hereby m....
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....g the tax by the service provider and then claiming the refund thereof by developer/unit. The exemption by way of refund would be limited to situations only when taxable services provided to SEZ are consumed partially or wholly outside SEZ. 3 to 10 .... 6.5 Further, various decisions of the Tribunal gives support to the admissibility of the refund claims filed by the appellant. These decisions also make reference to the relevant provisions of law, consequent to which the appellant is entitled to the subject refund claims. The tribunal in the case of Reliance Industries Ltd. vs. CCE, Mumbai: 2016 (41) STR 465 (Tri.-Mumbai) has inter alia observed as under: "3.10 The two notifications, in conjunction, have given effect to the statutory promise by devising two methods for availing the exemption - by upfront exemption when the service is rendered within the geographical boundaries of the Special Economic Zone and by the refund route where the physical performance of service is not within the boundaries but is intended for the authorized operation of the developer or unit. A pre-approval and verification system was also established in the same notifications - necessita....
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....bility has been discharged, the appellant is not eligible or not entitled for refund of the service tax paid under the provisions of Section 11B of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994. If the appellant is eligible for refund under Section 11B, then the same cannot be denied on the ground that the claim was made under Notification No. 9/2009-S.T. In this case, there is no dispute that the services were provided in relation to the authorized operations of the appellant within the SEZ. From the records it is seen that the appellant has filed the refund claim within the time period provided for in Section 11B and the appellant has borne the incidence of taxation. 6.3 Services provided to a SEZ or unit in the SEZ is deemed as export as per the provisions of Section 2(m)(ii) of the SEZ Act, 2005 and as per Rule 31 of the SEZ Rules, 2006, the appellant is entitled for exemption from payment of service tax on the services which are used or provided to a unit in the SEZ. As per Section 51 of the said SEZ Act, the said provisions prevail over the provisions contained in any other law for the time being in force. It is the avowed policy objectiv....
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....EZ, from seeking refund of service tax remitted on such transactions, by the providers of such services." 3.17 This was followed by the Tribunal again in re Reliance Ports & Terminals Ltd. as below: 6. The appellant has further relied upon the judgment of Intas Pharma Ltd. v. CST, Ahmedabad (supra) holding that in view of the provisions of Sections 7, 26 and 51 of 2005 Act [SEZ Act, 2005], exemption to services provided to a SEZ were always (available and Notifications No. 9/2009-S.T. and No. 15/2009- S.T. have only operationalized the exemption provided. Para 11 of the above judgment is reproduced below : "11. On true and fair construction of Notifications 9/2009 and 15/2009 issued under section 93(1) of the Act, considered in the light of overarching provisions of Sections 7 and 26(e) of the 2005 Act, the conclusion appears compelling that neither Notification 9/2009 nor 15/2009 disentitle immunity to service tax enjoined by the provisions of the 2005 Act. It therefore appears that Notification Nos. 9/2009 and 15/2009 merely contour the process by which the benefit of exemption/immunity to tax is operationalized. Notification Nos. 9/2009 and 15/2009 hav....