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2015 (11) TMI 1183 - AT - Service TaxDenial of rebate claim - Export of Output service - Option to export under claim of rebate or without payment of service tax under Export of Service Rules - Business Auxiliary Service - Held that:- Export of Service Rules facilitates the service provider with intention to avoid tax burden to be exported. Rule 4 of Service Rule only stipulates that any service which is taxable may be exported without payment of service tax. This cannot be construed as exemption from payment of service tax. The words used “exported without payment of duty” is different from “exempted from service tax”. Rule 4 is not exemption from service tax. It is only a provision that where the exporter may export services without payment of duty. Rule 5 of the Export of Services Rules clearly stipulates that where the taxable service is exported, the company can claim rebate of service tax paid on such taxable service by issue of specific notification. Therefore, notification No. 11/2005 was specifically issued for this purpose which clearly says that exporter of service who discharges service tax is allowed to claim rebate under Rule 5 of Export of Services Rules . There is no restriction for exporter that he should avail only Rule 4 and not Rule 5 of Export of Service Rules when there are two options available in the statute / rules, it is the right of the respondent to choose any of the provisions of the rules. Therefore, since in the present case payment of tax on the export of service is not disputed, the respondents are rightly eligible for rebate under Rule 5 of Export of Service Rules. - No infirmity in the impugned order in allowing the rebate of service tax paid on export services under Rule 5 of Export of Service Rules. Accordingly, the impugned order is upheld - Decided against Revenue.
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