TMI Blog2020 (2) TMI 964X X X X Extracts X X X X X X X X Extracts X X X X ..... les, Place of Provision of service or other Rules to hold that the appellant has not exported any services. The meaning of service and export contained in the special legislation of SEZ Act, 2005 by which SEZ or FTWZ has been created has to be given effect. The Service Tax Rules, 1994 cannot be pressed into application so as to defeat the intention and purpose of Section 26. When the intention of creating such FTWZ within India is to give exemption from levy of all duties and taxes, the department ought to have confined to the definitions contained in Section 2 (z) and 2 (m) of the said Act. Further, the consideration is received in foreign currency as well as the service recipient is a person placed outside India. The department cannot then contend that there is no export of services. The demand of service tax on consideration received by the appellant from the foreign service recipient under Storage and Warehousing services cannot be subject to levy of service tax under reverse charge mechanism - demand set aside - the issue is found in favour of the appellant. Demand on amounts collected by appellant and confirmed under various services - HELD THAT:- Learned Consultant has su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with respect to the services rendered to the foreign customers only. The department alleges that since the storage and warehousing services are provided in the FTWZ zone though it is rendered to foreign customers, the same cannot be considered as export of services. He adverted to the definition of services and export as given in Section 2 (z) and 2 (m) of SEZ Act, 2005, which is as under:- Section 2(m) in The Special Economic Zones Act, 2005 (z) services means such tradable services which,- (i) are covered under the General Agreement on Trade in Services annexed as IB to the Agreement establishing the World Trade Organization concluded at Marrakesh on the 15th day of April, 1994; (ii) may be prescribed by the Central Government for the purposes of this Act; and (iii) earn foreign exchange; (m) export means- (i) taking goods, or providing services, out of India, from a Special Economic Zone, by land, sea or air or by any other mode, whether physical or otherwise; or (ii) supplying goods, or providing services, from the Domestic Tariff Area to a Unit or Developer; or (iii) supplying goods, or providing services, from one Unit to another Unit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... since the place of provision of service is in India, the activity cannot be considered as export of service. Whether a service is to be treated as export or not was regulated under Export of Service Rules, 2005. As per these Rules, services mentioned in Rule 3 (ii) are performance based and even if such taxable services are provided outside India, it shall be treated as export of services and will be exempted from service tax. However, if such services are partly performed outside India, they will be treated as export of services. Place of Provision of Service Rules, 2012 were notified under the new Section 66 C of Finance Act, 1994, which provides for determination of place from where services are provided or deemed to be provided or deemed to have been agreed to be provided. After coming into effect of these Rules w.e.f. 01.07.2012, the Export of Service Rules, 2005 stands rescinded. He adverted to Rule 6 A of Service Tax Rules, 1994 and submitted that a service shall qualify for export when the following requirements are met:- a) the service provider is located in taxable territory; b) service recipient is located outside India; c) service provided is a service other t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d in, a Special Economic Zone or a Unit, to carry on the authorised operations by the Developer or entrepreneur; (b) exemption from any duty of customs, under the Customs Act, 1962 or the Customs Tariff Act, 1975 or any other law for the time being in force, on goods exported from, or services provided, from a Special Economic Zone or from a Unit, to any place outside India: (c) exemption from any duty of excise, under the Central Excise Act, 1944 or the Central Excise Tariff Act, 1985 or any other law for the time being in force, on goods brought from Domestic Tariff Area to a Special Economic Zone or Unit, to carry on the authorised operations by the Developer or entrepreneur; (d) drawback or such other benefits as may be admissible from time to time on goods brought or services provided from the Domestic Tariff Area into a Special Economic Zone or Unit or services provided in a Special Economic Zone or Unit by the service providers located outside India to carry on the authorised operations by the Developer or entrepreneur; (e) exemption from service tax under Chapter-V of the Finance Act, 1994 on taxable services provided to a Developer or Unit to carry on the au ..... 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