Section 93 of the Finance Act, Exemptions - Service Tax - Refund of tax paid on services used

Transcription

1 Service Tax: Computerised invoices downloaded through internet are eligible documents for claiming refund of service tax paid on services used for export, if they contain all relevant details, establishing availment of service used in export of goods [2015] 53 taxmann.com 207 (New Delhi - CESTAT) CESTAT, NEW DELHI BENCH Suncity Art Exporters v. Commissioner of Central Excise & Service Tax, Jaipur-II MS. ARCHANA WADHWA, JUDICIAL MEMBER AND RAKESH KUMAR, TECHNICAL MEMBER FINAL ORDER NOS OF 2014 SERVICE TAX APPEAL NOS , & OF 2012 OCTOBER 16, 2014 for export goods - Department denied refund claim on ground that original invoices raised by service providers were not submitted - Assessee argued that invoices were computerised invoices and were downloaded through internet and contained all relevant details, establishing availment of service used in export of goods - HELD : Denial of refund of service tax on ground of downloaded invoices is not in consonance with precedent decisions - Hence, matter was remanded back for verification [Para 4] [In favour of assessee] for export goods - Department denied refund claim on ground that various services provided by persons at port like bill of lading charges, documentary charges, REPO charges etc. cannot called to be port services and even service providers were not registered under port services category - HELD : Any services provided at port are 'port services' - Further, refund cannot be denied on ground that service providers are not registered for any particular services - Hence, matter was remanded back for verification [Para 5] [In favour of assessee] for export goods - Department denied refund of service tax paid on Customs House Agent (CHA) services and clearing and forwarding agent services on ground that invoices issued by said persons did not mention goods - Assessee argued that said invoices had cross reference to either invoice number or shipping bill number and/or container number and description of goods can be found out using such reference - HELD : Matter was remanded back for verification of cross reference as claimed by assessee [Para 6] [In favour of assessee] for export goods - Department denied refund claim on ground that Customs House Agent (CHA) had charged other charges which do not fall under CHA services and as such, service tax paid under CHA services cannot be allowed as refund - HELD : Inasmuch as and as long as CHA paid service tax on entire consideration under category of CHA services, service recipient would be entitled to benefit of same - When no objection as to classification was raised by revenue at time of collection of service tax from CHA, allowing them to raise such an objection at time of grant of refund would be against

2 principles of justice [Para 7] [In favour of assessee] for export goods - Department denied refund claim on ground that same was filed by describing transportation of the goods by road, whereas actual transportation was by rail and further, in some cases, claim was filed the category of Terminal Handling Charges instead of Customs House Agent (CHA) services - HELD : These were inadvertent mistakes having occurred in hands of person preparing refund claim and cannot result in denial of refund - Similarly claiming service tax under a different service category by referring to a wrong clause should not result in denial of refund, if it is otherwise due to assessee on merits [Para 8] [In favour of assessee] Circulars and Notifications :Circular No. 112/6/2009-ST, dated , 17/09-ST, dated Notification No. FACTS Facts The assessees are exporters of mostly handicrafts and are entitled to the refund of service tax paid on the various specified input services in terms of Notification No. 17/09-ST, dated Accordingly, they filed the refund claims in respect of various services like shipping and forwarding agent services, CHA services, terminal handling services, bill of loading services, documentary charges and transportation by rail etc. including the technical testing and analysis services and fumigation services. In some cases refund was rejected for non-submission of original invoices raised by the service providers. The assessee argued that - such invoices, which are computerised invoices, have been downloaded through the internet and have been held to be valid invoices in number of cases ; - the said invoices contained all the details like container number or shipping bill number, bill of loading number etc. and fully establishes the availment of the service used in the export of the goods. A part of the claim was denied on the ground that the various services provided by the persons at the port like bill of loading charges, documentary charges, REPO charges etc. cannot called to be port services as also on the ground that the service providers are not registered under the port services category, but are registered under different categories. The refund claim of service tax paid on CHA services/clearing and forwarding agent services stands denied on the ground that the invoices issued by the said persons do not mention the goods. The assessee argued that - the said invoices have cross reference to either invoice number or the shipping bill number and/or container number ; - from the said cross references the description of the goods can be found out and the denial of the claim on the said ground is not justified when admittedly the services have been used for the export of the goods. A part of the refund has been denied on the ground that CHA has charged other

3 charges which do not fall under the CHA services and as such the service tax paid by the CHA cannot be allowed as refund. In some cases, the refund claim was filed by describing the transportation of the goods by road, whereas the actual transportation was rail; the claim was filed under the category of THC instead of CHA. Issue Involved HELD Whether assessee was eligible for refund? Denial of refund of service tax on the ground of downloaded invoices is not in consonance with the precedent decisions as also in terms of the Board Circular No. 112/6/2009-ST, dated Hence, the Assistant Commissioner was directed to verify the assessee's refund claim afresh. [Para 4] Any services provided on the port are 'port services'. Further, refund cannot be denied on the ground that service providers are not registered for any particular services. Refund of service tax paid on THC charges, REPO charges, BL charges, DDC charges and haulage charges are admissible in as much as the same are port services. In view of the above, the Assistant Commissioner was directed to examine the assessee's refund claim and verify the same from the documents and decide the refund claim accordingly. [Para 5] The portion of the impugned order denying refund claim on ground of invoices not containing reference to goods was also set aside with directions to the Adjudicating Authority to undertake the necessary exercises for cross reference of the invoices with the description of the goods. [Para 6] In as much as and as long as the CHA paid the service tax on the entire consideration under the category of CHA services, the service recipient would be entitled to the benefit of the same. When no objection as to classification was raised by the revenue at the time of collection of service tax from the CHA, allowing them to raise such an objection at the time of grant of refund would be against the principles of justice. [Para 7] Inadvertent mistakes like stating transport by road instead of by rail, filing refund claim as THC rather than as CHA, having occurred in the hands of the person preparing the refund claim, cannot result in denial of refund. Similarly claiming the service tax under a different service category by referring to a wrong sub-section should not result in denial of the refund, if otherwise due to the assessee on merits. [Para 8] For all the reasons, the impugned orders were set aside and matter was remanded back to Assistant Commissioner for examining the assessee's refund claim afresh, in the light of the law declared by the Tribunal in various decisions as also after verification of the documents, without raising technical and procedural issues. [Para 9] CASE REVIEW

4 CCE v Gokul Refoils & Solvents Ltd. [2013] 42 GST 137/32 taxmann.com 245 (Ahd.) (para 4); Creative Architects & Interiors, In re [Order Appeal No. 213/2011 (Mst), dated ] (para 4); Western Agencies (P.) Ltd. v CCE [2011] 31 STT 498/11 taxmann.com 55 (Chennai - LB) (para 5); Aarvee Denims & Exports v CCE [Order Nos. A/ /WZB/AHD/2009, dated ] (para 5); CCE v. Dishman Pharmaceuticals v. Chemicals Ltd. [Order NO. A/ /WZB/Ahd/2010, dated ](para 5) and CCE v. Ramdev Food Products (P.) Ltd. [Final order Nos. A/ / WZB/Ahd., dated ] (para 5) relied on. CASES REFERRED TO CCE v. Gokul Refoils & Solvents Ltd. [2013] 42 GST 137/32 taxmann.com 245 (Ahd.) (para 3), Creative Architects & Intriors, In re [Order Appeal No. 213/2011 (M-ST), dated ] (para 3), Western Agencies (P.) Ltd. v. CCE [2011] 31 STT 498/11 taxmann.com 55 (chennai - LB) (para 5), Aarvee Denims & Exports Ltd. v. CCE [order No. A/ /WZB/Ahd/2009, dated ] (para 5), CCE v. Dishman Pharmaceuticals & Chemicals Ltd. [Order No. A/ /WZB/Ahd/2010, dated ] (para 5) and CCE v. Ramdev food Products (P.) Ltd. [Final Order Nos. A/ /2010-WZB/Ahd, dated ] (para 5). O.P. Agarwal, CA for the Appellant. Sanjay Jain, AR-DR for the Respondent. ORDER Ms. Archana Wadhwa, Judicial Member - All the appeals are being disposed by a common order as the issue involved in all of them is identical. 2. After hearing both the sides duly represented by Shri O.P. Agarwal, learned Chartered Accountant for the appellant and Shri Sanjay Jain, learned DR for the respondent, we find that the appellants are exporters of mostly handicrafts and are entitled to the refund of service tax paid on the various specified input services in terms of Notification No. 17/09-CUS dated 7/7/09. Accordingly, they filed the refund claims in respect of various services like shipping and forwarding agent services, CHA services, terminal handling services, bill of loading services, documentary charges and transportation by rail etc. including the technical testing and analysis services and fumigation services. 3. Without going into the individual reasons for denial of refund claim in each and every case in respect of each and every issue, we find that in some cases refund stand rejected for non-submission of original invoices raised by the service providers. The appellant's contention is that such invoices which are computerised invoices have been down loaded through the internet and have been held to be valid invoices in number of cases. Reference is made to the Tribunal's decision in the case of CCE v. Gokul Refoils & Solvents Ltd. [2013] 42 GST 137/32 taxmann.com 245 (Ahd.), which allowed the refund claim even on the certified photocopies. Similarly, in the case of Creative Architects & Interiors In re [order Appeal No. 213/2011 (M-ST), dated ], precedent decisions were taken note of and it was held that Cenvat credit is not to be denied on the basis of computer generated invoices. Learned Advocate submits that the said invoices contained all the details like container number or shipping bill number, bill of loading number etc. and fully establishes the availment of the service used in the export of the goods. 4. In view of the above, we find that the denial of refund of service tax on the said ground is not in consonance with the precedent decisions referred (supra) as also in terms of the Board Circular No. 112/6/2009-ST dated 12/03/2009. We accordingly direct the Assistant Commissioner to verify the

5 appellant's refund claim afresh. 5. A part of the claim stand denied on the ground that the various services provided by the persons at the port like bill of loading charges, documentary charges, REPO charges etc. cannot called to be port services as also on the ground that the service providers are not registered under the port services category, but are registered under different categories. We find that Larger Bench of the Tribunal in the case of Western Agencies (P.) Ltd. v. CCE [2011] 31 STT 498/11 taxmann.com 55 (Chennai - LB), has held that any services provided on the port are 'port services'. Further in the case of Aarvee Denims & Exports Ltd. v. CCE [order No. A/ /WZB/AHD/2009, dated ] as also in the case of CCE v. Dishman Pharmaceuticals & Chemicals Ltd. [order No. A/ /WZB/AHD/2010, dated ] it has been held that refund cannot be denied on the ground that service providers are not registered for any particular services. We also take note of the Tribunal's decision in the case of CCE v. Ramdev Food Products (P.) Ltd. [Final order Nos. A/ /2010-WZB/AHD, dated ] laying down that refund of service tax paid on THC charges, REPO charges, BL charges, DDC charges and haulage charges are admissible in as much as the same are port services. In view of the above, we direct the Assistant Commissioner to examine the appellant's refund claim and verify the same from the documents and decide the refund claim accordingly. 6. The refund claim of service tax paid on CHA services/clearing and forwarding agent services stands denied on the ground that the invoices issued by the said persons do not mention the goods. The appellant's contention is that admittedly the said invoices have cross reference to either invoice number or the shipping bill number and/or container number. From the said cross references the description of the goods can be found out and the denial of the claim on the said ground is not justified when admittedly the services have been used for the export of the goods. The said portion of the impugned order is also set aside with directions to the Adjudicating Authority to undertake the necessary exercises for cross reference of the invoices with the description of the goods. 7. Further a part of the refund has been denied on the ground that CHA has charged other charges which do not fall under the CHA services and as such the service tax paid by the CHA cannot be allowed as refund. We are of the view that in as much as and as long as the CHA paid the service tax on the entire consideration under the category of CHA services, the service recipient would be entitled to the benefit of the same. No such objection was raised by the Revenue at the time of collection of service tax from the CHA and allowing them to raise such an objection at the time of grant of refund would be against the principles of justice. 8. In some cases, we note that the refund claim was filed by describing the transportation of the goods by road, whereas the actual transportation was rail; the claim was filed under the category of THC instead of CHA. These are the inadvertent mistakes having occurred in the hands of the person preparing the refund claim. Similarly claiming the service tax under a different service category by referring to a wrong sub-section should not result in denial of the refund, if otherwise due to the appellant on merits. 9. For all the reasons, we set aside the impugned orders and remand the matter to Assistant Commissioner for examining the appellants refund claim afresh, in the light of the law declared by the Tribunal in various decisions as also after verification of the documents, without raising technical and procedural issues. All the appeals are thus allowed by way of remand.

6 VINEET In favour of assessee.