Service tax refund cannot be denied on Legal Export of goods although procured through illegal means

V.V. Minerals [100% EOU] Vs Commissioner of GST & CE (CESTAT Chennai)

Unless there Is any provision to the contrary, the charging sections of the tax laws apply to illegal acts as they apply to legal acts and therefore tax is leviable notwithstanding that action for the illegal actions may be taken under some other law. This does not amount to endorsing the illegal activity by the State but only the recognition that it has taken place. This taxes Illegal businesses and does not absolve them of their tax liability by virtue of their Illegality. Since tax is leviable on illegal activity, tax benefits or tax relief are equally available to illegal businesses.

The present case pertains to the Service Tax under Chapter V of the Finance Act, 1994. After 2012 amendment, relevant provisions of this Act, viz., definitions of ‘Service’ and ‘taxable service’ and the charging section are as follows:

Section 65 B: Interpretations:

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