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Commissioner of Service Tax V/S Dell India Pvt. Ltd.

    Appeal No. ST/292/2012-SM (Arising out of Order-in-Appeal No. JMJ-49-2011, Dated: 31.10.2011 Passed by Commissioner(Appeals), LTU, Bangalore) and Final Order No. 22468/2017

    Decided On, 13 October 2017

    At, Custom Excise and Gold Control Appellate Tribunal South Zonal Bench Bangalore

    By, THE HONORABLE JUSTICE: S.S. GARG
    By, MEMBER

    For Petitioner: Parashivamurthy, Dy. Commissioner (A.R.) And For Respondents: Syed Peeran, Advocate.



Judgment Text


1. The present appeal has been filed by the Revenue against the impugned order dt. 31/10/2011 whereby the Commissioner(Appeals) has set aside the Order-in-Original rejecting the refund on transportation of goods. Briefly the facts of the present case are that the respondent had filed refund application dt. 14/05/2010 for refund of service tax of Rs. 16,20,263/- paid on the input services like the courier service transportation of goods, control tower charges used in SEZ operations at their manufacturing unit at Chennai SEZ during the month of March 20

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10 consequent to the Notification No. 9/2009-ST dt. 03/03/2009. The Assistant Commissioner issued a show-cause notice dt. 11/06/2010 for rejecting the refund claim relating to the month of March 2010 saying that the services were post manufacturing expenses and some of the services were wholly consumed in SEZ. After following the due process of law, the original adjudicating authority vide Order-in-Original rejected the refund claim by the respondent. Aggrieved by the said order, respondent filed appeal before the Commissioner(Appeals) who allowed the appeal with regard to refund of service tax on transportation of goods. Hence the present appeal by the Revenue.

2. Heard both the parties and perused records.

3. Learned AR for the Revenue submitted that the impugned order is not sustainable in law as the same has been passed without appreciating the contents of the Notification No. 9/2009-ST and No. 15/2009. He further submitted that transportation of goods being outside freight is a post manufacturing operation pertaining to the sale of the goods and is beyond the authorised operation allowed which is manufacture. The transportation of goods service is provided after the authorised operation of manufacture is over and is in connection with the sale of goods.

4.1 On the other hand, the learned counsel for the assessee defended the impugned order and submitted that in terms of the Notification to be eligible to claim refund, the services should be in relation to the authorised operation and in the instant case the transportation of goods is in relation to the authorised operation on the following grounds:-

i. Trading of goods is included in the authorised operation.

ii. The goods are sold to the customers on CIF basis (cost, insurance and freight) in which case the place of removal is the customers' premises and analogy can be drawn from Rule 2(l) of the CENVAT Credit Rules, 2004 wherein credit in terms of Rule 2(l) of the CENVAT Credit Rules, 2004 is eligible up to place of removal.

iii. Transportation of goods by air and road is specifically included in additional list of services required for authorised operations under Sl.No. 32 and 33 of the list.

4.2 He further submitted that exemption in Notification No. 9/2009-ST is for all specified services as approved by the Development Commissioner and it is not for the Department to re-examine whether the said services are used in the authorised operations or not. The Notification in para 3(g) casts only minimum obligation for the adjudicating authority i.e. to check whether the service tax for which refund has been claimed has actually been paid to the Department. In support of his submission, he relied upon the following decisions:-

i. Tata Consultancy Services Ltd. Vs. CCE(LTU), Mumbai [2013(29) Service Tax Rules, 1994.

ii. Dell India Pvt. Ltd. Vs. CST, Bangalore [Final Order No. 20664-20665/2015 dt. 10/03/2015]

4.3 Further the appellant relied on the decision in the case of Wardha Power Co. Ltd. Vs. CCE [2013(30) STR 520 (Tri. Mum.)] wherein it was held that SEZ unit entitled to claim refund so long as services rendered in respect of authorised operations irrespective of place of rendering service i.e. whether inside or outside unit. He further submitted that if service tax has been paid on the specified services used in authorised operation, exemption to the same is available by way of refund as per the Notification No. 9/2009-ST and No. 15/2009-ST. In support of this submission, he relied upon the following decisions:

i. Nokia India Pvt. Ltd. Vs. CST, Chennai

ii. Reliance industries Ltd. Vs. CCE, Mumbai-I [2016(41) STR 465 (Tri. Mumbai)]

iii. Reliance Ports & Terminals Ltd. Vs. Commissioner [2015(40) STR 200 (Tri.)]

iv. CST Vs. Zydus Technologies Ltd. [2014(35) STR 515 (Guj.)]

v. Intas Pharma Ltd. Vs. CST, Ahmedabad [2013(32) STR 543]

vi. Zydus Tech Ltd. Vs. CST, Ahmedabad [2013(30) STR 616]

4.4 He further submitted that the refund was allowed in respect of transportation service in the respondent's own case as decided by this Hon'ble Tribunal vide Final order No. 21157-21163/2015 dt. 12/05/2015. After considering the submissions of both the parties and perusal of material on record and the various judgments relied upon by the respondent in support of their case, wherein it has been consistently held that the assessee is entitled for refund of service tax paid for the services which is in relation to authorised operations in the SEZ. Moreover, in the respondent's own case, this Tribunal has already allowed the refund in respect of the transportation service by relying upon the decision in the case of Tata Consultancy Services Ltd. cited supra. Therefore by following the ratios of the above said decisions, I am of the considered view that there is no infirmity in the impugned order which is upheld by dismissing the appeal of the Revenue
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