Service tax on Charges for terminal handling, DOC & bill of lading services used for export are eligible for refund
CESTAT, AHMEDABAD BENCH
Commissioner of Service Tax, Surat
ORDER NOS. A/1351-1358/WZB/AHD/2012
APPEAL NOS. ST/20 TO 25, 27 & 28 OF 2011
AUGUST 31, 2012
1. All these appeals are taken up together for disposal by a common order as the issue involved in all the appeals is the same.
2. Heard both sides and perused the record.
3. On perusal of record, 98 find that the appellants herein had filed various refund claims before the adjudicating authority for the refund of service tax paid by them to the service providers, under the category of CHA services, Courier services, Banking and Finance services etc. In the refund claims, the appellants stated categorically that they are manufacturer/merchant exporter and credit of service tax paid needs to be refunded to them as per the provisions of Notification No.41/2007-ST dated 06.10.2007. It is also seen from the records that the appellants herein had provided entire set of documents on which they are relying for the purpose of claiming the refund. Adjudicating authority rejected the refund claims on two grounds. The adjudicating authority in ground No.1 said, that the question of unjust enrichment will arise and the documents which are produced by the appellant do not co-relate to the exports made.
4. On an appeal against such an order, the first appellate authority held in favour of the appellants as regards the unjust enrichment but has upheld the order in original on the ground that the invoices on which the service tax has been paid by the appellant to the service provider does not have any co-relation of the services provided. Subsequently, the said invoices were corrected by the servicer providers. The findings of the first appellate authority on this point is as under :-
“8.6 Analysis of the Bills/Invoices raised by the service providers indicates that major claim is on account of tax paid on the services such as Terminal Handling Charges which was not specified under the Notification No.41/2007 dated 06.10.2007. Besides THC, claims on account of DOC charges, Bill of Lading charges and many other services are not admissible as such services are not specified under the Notifications. Taxes paid on C & F Agency are admissible with effect from 07.12.2008 subject to condition that C & F Agent issues invoice indicating the number and date of Shipping Bill, description of export goods, number and date of export invoice. Examination of claim documents indicate that Shipping Bill No. on the invoices after issue. The claim for Courier Services do not satisfy the conditions of the notification.
9. The refund is available subject to certain conditions and requirements prescribed under the notification. Such conditions and requirements are considered mandatory. It is evident that the law making authority has prescribed various requirements to prevent leakage of Revenue and to prevent fraud. The notification seeks to grant exemption (by way of refund) only to specified services and not all taxable services. Certain requirements such as mentioning Shipping Bills and details of exports in the Bills are for correlating that bills are for export. These details are required to be mentioned on the Bills by the service provider at the time of making of the Bills and deficiency cannot be corrected by inserting these details subsequently. As quasi judicial authorities, the executive authorities have a duty to implement the law as notified. May be certain requirements of the notifications are very strict but authorities have no choice but to exercise discretion only to the extent statute places such discretion at their disposal.”
5. As against the above finding, I find that, as correctly pointed out by the learned counsel in the case of Ramdev Food Products (P.) Ltd. v. CCE  21 taxmann.com 410 (CESTAT – Ahd.) and again in the case of CCE v. Ramdev Food Products (P.) Ltd. [Final Order Nos. A/861-863/2010-WZB/Ahd., dated 30-6-2010] this bench has held that refund of service tax paid on THC, DOC charges, Haulage charges under the Port services and Courier charges and CHA services are eligible for refund.
6. The ratio of the said decisions will squarely cover the issue in the cases before me and I hold that appellants are eligible for the refund of amount of service tax paid by them to the service providers.
7. As regards non-mentioning of Shipping Bill numbers/Bill of Lading numbers etc., I find that in the case of M.R. Organisation v. CCE [F.O. No. A/2310/2009-WZB/Ahd., dated 30-10-2009], this Bench has clearly held that such cross references on the invoices is a curable defect and the can be corrected subsequently at any given point of time. As already reproduced my me, the first appellate authority has not denied the fact that the said services were rendered by the service providers towards the export of goods. The defects which are pointed out by the first appellate authority as well as by the adjudicating authority are curable and are cured subsequently by the appellants and service providers, I do not find any reason for denying the refund of amount of service tax paid by the appellant to service providers.
8. As regards the service tax paid by the appellant on Banking and Financial services, I find that both the lower authorities have not recorded any finding on this point. At the same time, it is not in dispute that the said Banking and Financial services were utilised by the appellant towards the Banking charges involved in the export of goods. If that be so, in my considered view, refund claims of the appellants as this point cannot be rejected.
9. In view of the forgoing, respectfully following the ratio of various case laws cited, I find that appellants are eligible for the refund of amount of service tax paid by the service providers on various services, for which they have filed the refund claims. In view of the foregoing, I find that impugned orders are liable to be set-aside and I do so.
Impugned orders are set-aside, appeals are allowed with consequential relief to the appellants.