TaxTMI 
TaxTMI 
2024 (8) TMI 1766
X X X X Extracts X X X X
X X X X Extracts X X X X
....rovide the said output services procured various input services and paid service tax on the same. 3. The date-wise chronology of events resulting in passing of the impugned Order-In-Appeal is as under :- S. No. Dates Events 1. 29.08.2016 & 05.10.2016 Refund Application filed for the relevant period under Notification No. 12/2013-ST for the services used in relation to the authorized operations in the SEZ Unit, as approved by the Approval Committee. The refund claim was rectified vide letter dated 05.10.2016 seeking a refund amounting to Rs. 17,11,76,070/- 2. 13.01.2017 After verification refund amounting to Rs 15,53,68,504/- was granted by the Ld. Adjudicating Authority vide refund order (Order-in-Original) dated 13.01.2017. Simultaneously, a Show Cause Notice was issued denying the refund of the remaining amount of Rs 1,58,07,566/- alleging that the Appellant has incorrectly claimed a refund of: ⮚ Rs 1,45,41,775/- on the invoices raised to unregistered premises. ⮚ Rs 6,14,764/- on missing original invoices ⮚ Rs. 6,51,027/- on time-barred invoices. 3. 07.02.2017 The App....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 6. 20.04.2018 The Commissioner vide Order-in-Appeal No. 35/COMMR. /MEERU/2018 remanded the refund claim amounting to Rs. 1,47,87,756 and rejected the refund claim Rs 6,51,027/- The said amount is bifurcated as: ⮚ Rs. 1,36,31,118/- amount related to invoices issued to unregistered premises where the premises were registered before claiming of the refund. ⮚ Rs 7,67,386/- amount related to invoice which had minor variations ⮚ Rs. 3,89,252/- amount related to photocopied invoices. ⮚ Rs. 6,51,027/- amount related to time barred refund. 4. Aggrieved Appellant has filed the present appeal. 5. Learned Advocate appearing on behalf of the Appellant submits that SEZs are specifically delineated duty-free areas wherein units may be set up for specified purposes of manufacturing, trading or rendering services or providing warehouse facility for export. The Appellant, being an SEZ unit, has claimed exemption from payment of service tax by way of refund under Notification 12/2003-ST, on input services received by the SEZ unit that have been used for authorised operations as approved by the Approval Committee. 6. He f....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n Rs.) Findings Order 1. Amount related to invoices issued to unregistered premises where the premises were registered before claiming of the refund. 1,36,31,118/- Refund/credit would be allowed only if premises were registered before the date of the invoice/receipt of the input service Remanded to verify 2. Time Barred Refund 6,51,027/- Refund would be rejected in cases where it was filed beyond one year from date of payment of tax as per section 11 B of the central excise act Rejected, but original authority can allow refund on invoices on which credit was availed within the time limit under Sec. 11B 12. We find that the Commissioner has rejected or remanded the refund request on several technical grounds, such as issuing invoices to unregistered persons, not submitting original invoices and delayed filing. However, despite these technical issues the Appellant is still eligible for a refund under the express exemption provided in the notification. According to the notification, SEZ units are entitled to service tax exemption by way of a refund for input services used in their authorised operations. Relianc....
X X X X Extracts X X X X
X X X X Extracts X X X X
....without registration, credit/refund can be availed as the same is being used for providing Output services. 17. The total amount of Rs. 6,51,027/- was rejected on the ground that it was a time barred refund, the same can be further bifurcated into: ⮚ Rs 2,32,611/- related to invoice on which refund was claimed within one year as per Section 11B of Excise Act. ⮚ Rs. 4,72,361/- related to invoice on which refund was claimed within one year as per Notification No. 12/2003- ST. ⮚ Rs 1,78,666/- related to invoices on which refund was claimed beyond prescribed under Notification No. 12/2003- ST. 18. The refund claim can be filed within one year from the last date of the month in which service tax was paid as per the Notification. On the contrary, Section 11 B of the Excise Act, provides that the limitation period would end on the expiry of one year from the date of payment of tax. In the present case, since the refund claim has been specifically filed under Notification No. 12/2003-ST, the limitation period of Notification will apply and not Section 11B. Hence, the refund claim of Rs 4,72,361 shall be allowed as it is a set principle ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rt of the order is pronounced in open court) Sd/- (P. K. CHOUDHARY) MEMBER (JUDICIAL) Separate Concerning Order (SANJIV SRIVASTAVA) MEMBER (TECHNICAL) SANJIV SRIVASTAVA: 23. I have gone through the order prepared by the landed Member (Judicial), however, I would like to record a separate order in the matter. 24. The issue involved in the present matter is with regards to admissibility of two refund claims i.e. (i) amounts related to invoices issued in the name of unregistered premises were registered before claiming of the refund amounting to Rs.1,36,31,118/-. (ii) Time barred refund amounting to Rs. 6,51,027. 25. In respect of first issue matter is reminded back by the Commissioner (Appeals) to the Original Authority by observing as follows :- "Accordingly, if the premises to which the said invoices were issued were registered as on the date of invoice/receipt of the said input services, I allow the credit/ refund to the appellant, otherwise not. As regards the contention of the appellant regarding invoices having minor variations in address mentioned on invoices, I, observe that intent of the law is to allow credit on inputs/input services w....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d by the said notification. Further, this Bench of the Tribunal has decided the present issue in the case of M/s Steria India Final Order No.70277-70280 dated 21 December, 2023 by holding as follows :- "3.3 The issue in respect of applicability of the said condition for considering the application of refund made under the said notification is no longer res-integra and has been adjudged in a series of decisions of CESTAT. I reproduce the relevant paragraphs from the recent decision of the Allahabad Bench in the case of EXL Services SEZ BPO Solutions Pvt. Ltd. [2023-TIOL-852-CESTAT-ALL] on the issue: 4.4 Further, we find that the only issue for consideration in the present case is whether the claim for refund made in terms of the notification No 9/2009-ST dated 03.03.2009 can be denied just for the reason that the taxable services in respect of the which the claim has been made, are not mentioned in the list of specified services approved by the SEZ authorities. The scheme of SEZ Act, provides for exemption from payment of all taxes to the developer of SEZ or the Units operating in the SEZ. Notification No 9/20009-ST does not provide for any further exemption but pr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ntion of the Learned Counsel for the appellant, therefore, is that not only does the impugned order not contain any specific finding or quantification, but even otherwise the requirement of grant of approval by the UAC cannot be considered as a mandatory condition to override the exemption that has been granted under Section 26 of the SEZ Act and the SEZ Rules framed thereunder. It is, therefore, the contention that the Commissioner (Appeals) committed an illegality in rejecting the refund applications filed by the appellant. 42. Learned authorised representative has, however, submitted that the appellant is not entitled to the refund. 43. The records indicate that the appellant had during the relevant period only one operating unit in the SEZ. All the input services were, therefore, used by the appellant for the authorized operations, namely, BPO (ITES) as per the specific condition prescribed under the SEZ Act for seeking exemption from service tax and the letter dated June 19, 2008. The output services rendered by the SEZ unit of the appellant is for authorized operations. It is not the case of the Department that the output services have been used for services....
X X X X Extracts X X X X
X X X X Extracts X X X X
....on record, I find that the appellant being SEZ is entitled to refund 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 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....r overriding effect. Therefore the immunity provided from paid service tax cannot be taken away by the procedural prescriptions of Notification No. 9/2009 or 15/2009. These notifications are calibrated to enable recipients of taxable services of SEZ, etc., to get benefit of exemption of the service tax. In any case, since the appellants have obtained approval for the said services, we find that the error would only be a procedural infraction which can be condoned. The substantive benefit cannot be denied for a procedural lapse. The claim of Rs. 967/- being given up by appellant is not considered in this appeal." (Emphasis supplied) 48. Thus, the Commissioner (Appeals) was not justified in rejecting the refund claims on this ground." B. In case of SRF Ltd [2022 (64) GSTL 489 (T-Del)] tribunal held as follows: "36. Special Economic Zones created under the SEZ Act are on a different footing because the SEZ Act itself exempts goods and services supplied for authorised operations to developers and units in the SEZs from the Customs Duty, Central Excise Duty and Service Tax. The provisions of SEZ Act prevail over any other law. Section 26(1) of the SEZ Act, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ised operations of SEZ developers and units are concerned, Section 26 of the SEZ Act overrides the charging sections in all the three Acts. 39. The charging sections, having been overridden by the SEZ Act passed by the Parliament, no legal authority to levy and collect central excise duty, customs duty or service tax for goods or services supplied for authorised operations of SEZ developers and units covered by Section 26 remains. Without such a legal authority, no tax or duty can be either levied or collected in view of Article 265 of the Constitution of India. 40. Therefore, there is no need for any exemption notifications under any of these three Acts nor is it necessary to fulfil any conditions of any of the conditions laid down in exemption notifications, if any, issued for the purpose. Thus, the charge of excise duty under Section 3 of the Central Excise Act, the charge of Customs Duty under Section 12 of the Customs Act and the charge of service tax under Sections 66, 66A and 66B of the Finance Act, 1994 will not apply to goods and services supplied to developers and units for authorized operations in the SEZ areas by virtue of the overriding provisions of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... any other law for the time being in force, on goods imported into, or service provided in, a Special Economic Zone or a Unit, to carry on the authorised operations by the Developer or entrepreneur; (b) exemption from any duty of customs, under the Customs Act, 1962 or the Customs Tariff Act, 1975 or any other law for the time being in force, on goods exported from, or services provided, from a Special Economic 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 unde....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the following decisions: ⮚ Tega Industries Ltd. {2022 (67) GSTL 81 (T-Ahmd)] ⮚ Intas Pharmaceuticals Ltd. [2022 (64) GSTL 216 (T- Ahmd)] ⮚ Divi's Laboratories Ltd. [2021 (54) GSTL 400 (T-Hyd)] ⮚ Herman Connected Services Corporation India Pvt Ltd. [2021 (49) GSTL 11 (T-Bang)] ⮚ SE Forge Ltd. [2019 (365) ELT 560 (T-Chennai)] ⮚ Reliance Ports and Terminals Ltd. [2015 (40) STR 200 (T- Ahmd)] 3.5 On the ground for rejection that certain invoices were addressed to some other premises of the Appellant which are outside the SEZ. I do not find any merits in the said ground. If it can be shown that the services covered by the said invoices were received and consumed by the appellant unit located in SEZ, then the CENVAT Credit/ Refund could not have been denied. In my view it is the place of receipt and consumption of service which shall determine the admissibility of CENVAT Credit/ Refund. If the appellant is able to establish that the services were received by them in their unit located in SEZ, CENVAT Credit/ Refund as per these notifications shall be admissible to him. In case of ....