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TMI Blog2017 (6) TMI 364X X X X Extracts X X X X X X X X Extracts X X X X ..... g authority partly by way of cheque and partly by way of re-credit in Cenvat account. Aggrieved, department filed an appeal before the Commissioner (Appeals), on the ground that out of the refund amount sanctioned Rs. 40,265/- is not eligible since that portion relates to services rendered to SEZ and such services are only exempted and not export of services. Appeal of the department was allowed by the Commissioner (Appeals) vide the impugned order dated 29.07.2016, on the ground interalia that the appellants have not followed the procedures laid down in Notification No.17/2011-ST dated 01.03.2011. Hence, this appeal before this forum. 2. Today, when the matter came up for hearing, Id. Advocate Shri Alwan referring to Section 51 & 53 of SE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eproduce the relevant portion of the said Rule 5 of the Cenvat Credit Rules, 2004:- "RULE [5. Refund of CENVAT Credlt. - (l) A manufacturer who clears a final product or an intermediate product for export without payment of duty under bond or letter of undertaking, or a service provider who provides an output service which is exported without payment of service tax, shall be allowed refund of CENVAT credit as determined by the following formula subject to procedure, safeguards, conditions and limitations, as may be specified by the Board by notification in the Official Gazette : Refund amount = (Export turnover of goods + Export turnover of services) Total turnover x Net CENVAT Credit Where, (A) "Refund amount" means the maximum re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pril, 2012 . Provided that the refund may be claimed under this rule, as existing, prior to the commencement of the CENVAT Credit (Third Amendment) Rules, 2012, within a period of one year from such commencement : Provided further that no refund of credit shall be allowed if the manufacturer or provider of output service avails of drawback allowed under the Customs and Central Excise Duties and Service Tax Drawback Rules, 1995, or claims rebate of duty under the Central Excise Rules, 2002, in respect of such duty; or claims rebate of service tax under the [Service Tax Rules, 1994] in respect of such tax. Explanation 1. - For the purposes of this rule, - (1) export service" means a service which is provided as per [rule 6A of the Service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tions, as may be specified, by the Central Government, by notification.] 7.1 As per Section 53 of SEZ Act, 2005, the SEZ territory is to be treated as territory outside the customs territory of India. Further, according to the SEZ Act 2005, supply of goods from DTA to SEZ constitutes exports. As per Section 51 of the SEZ Act 2005, the provisions of the Act will have overriding effect over the provisions of any other law in case of any inconsistency. This position has been confirmed by the CBEC through Circular No.1001/8/2015-CX8 dated 28.04.2015. 7.2 In the event, for the purposes of Rule 6 A of Service Tax Rules, the SEZ will necessarily have to be treated as territory deemed to be located outside India and the provision of any services ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 18.06.2012, substitution has been made w.e.f. 01.03.2016, basic principle of foreign exchange will definitely be an important requirement even for the prior period. At this point, Id. Advocate confirms that they have indeed received the amount in foreign exchange. 8. Viewed in the totality of the discussions as above, in my considered opinion, export of such services to SEZ will necessarily have to be treated as deemed export and will be eligible for refund of accumulated credit under Rule 5 of CCR and notifications issued thereunder subject to the various conditionalities of that Rule and related notifications being satisfied. In the instant case, only the matter for consideration is whether payment for the services rendered to SEZ have ..... X X X X Extracts X X X X X X X X Extracts X X X X
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