TMI Blog2023 (5) TMI 762X X X X Extracts X X X X X X X X Extracts X X X X ..... TMI 34 - SUPREME COURT ], Hon ble Apex Court held that it becomes clear that a right accrued to the assessee on the date when they paid the tax on the raw materials or the inputs and that right would continue until the facility available thereto gets worked out or until those goods existed. Therefore, it becomes clear that Section 37 of the Act does not enable the authorities concerned to make a rule which is impugned herein and, therefore, we may have no hesitation to hold that the Rule cannot be applied to the goods manufactured prior to 16-3-1995 on which duty had been paid and credit facility thereto has been availed of for the purpose of manufacture of further goods. The observation made by the Commissioner (Appeals) in respect of the provisions of Section 173 of The Central Goods and Service Tax Act, 2017, are in respect of the repeal of notification 41/2012-ST without even referring to the Section 174(2) ibid, cannot impact the rights accrued to the appellant prior to such repeal. As is evident from the wording of the notification and the decision of the Hon ble Supreme Court the right to rebate has accrued to the appellant at the time of the receipt of the specified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing grounds: i. The provision of Notification No 41/2012-ST dated 29.06.2012 ceases to be applicable from 01.07.2017. ii. The provision of time of supply of goods is applicable under Section 12 of CGST Act, 2017 for export of goods during the period of October to December 20017. iii. Under Section 16 of the IGST Act, GST is not applicable in India on exports. iv. Instead of following the provisions of CGHST Act, 2017, the appellant filed the refund claim under repealed Notification. 2.4 The appeals filed by the revenue were allowed by the Commissioner (Appeals) as per the impugned order in para 1, above. 2.5 Hence these appeals. 3.1 Have heard Ms. Seema Lakhotia, Chartered Accountant for the appellant and Shri S B P Sinha, Superintendent, Authorized Representative for the revenue. 3.2 Arguing for the appellant learned counsel submits that: The right to rebate/ refund of the service tax paid has accrued to the appellant in the terms of the Notification No 41/2012-ST, as they had paid service tax on technical inspection and certification services, much before 01.07.2017. The right which had accrued would not be fettered by the subsequent events ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refund claimed 1 July, 2017 to September 29.06.2018 18,54,484 02.08.2017 17,93,395 (i) From the above table, it is clear that all the refund claims have been filed within the stipulated time period of one year as specified in the said Notification. iii) The said claimant has claimed refund of service tax paid Technical Inspection and Certification which are taxable services as the same are neither covered in negative list nor in any exemption notification. The said service is claimed to have been received by the claimant and used for export of goods beyond the place of manufacture for the said period as seen from the relevant input invoices issued by the service providers and details like (a) number and date of shipping bill, (b) description of goods exported (c) number and date of the invoice issued by the exporter relating to export of goods (d) details of all the charges, whether or not reimbursable, collected by the Agents from the said claimant in relation to export of goods. As such the linkage of the above said service with the goods ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ichment does not arise, since the rebate is granted to the exporter of goods by virtue of Notification No. 41/2012-ST dated 29.06 2012, as amended, which is in the form of refund of Service Tax paid on specified input services which are received and used by the exporter in relation to the goods exported and has not received electronic rebate of Service Tax from customs on the shipping bills on which refund is claimed on the basis of procedure prescribed in paragraph 2 of the said Notification. The claimant has filed Refund Claims in Form A-1, as specified under Paragraph 3 of the said Notification, which contains a Declaration that (a) electronic rebate of Service Tax has not been received from Customs on the shipping bills on which rebate/refund is claimed; (b) No CENVAT of Service Tax paid on specified services used for export of goods has been availed under the Cenvat Credit Rules, 2004; (c) rebate/refund has been claimed for Service Tax which has been actually paid on specified services used for export of goods. It is seen from copies of Shipping Bills against which the refund claim is filed, shows that no Drawback is claimed and/or granted with words DBK + STR (INR Rs.)- 0.00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ided in the instant appeal is whether the Respondent has rightly claimed the refund under the provisions of Notification No. 41/2012-ST dated 29.06.2012 or the Adjudicating Authority has erred in sanctioning the refund on the basis of the repealed Notification ibid. 8. Regarding the above issue, I find that the Appellant has raised a valid question as the refund claims were filed after the roll out of GST on the Appointed day i.e. 01.07.2017, and by this date the Notification ibid was already repealed vide Section 173 of the Central Goods Service Tax Act, 2017. In the light of this fact, the refund claims were not eligible for processing under the erstwhile provisions of Service Tax regime, as it should have been filed under the new rolled out provisions of CGST Act, 2017. As regards the plea of the Respondent that the provisions under the sub-section 4 of Section 142 of the CGST Act, 2017 are applicable in their case, I find that the same needs to be perused diligently. The same states that: Every claim for refund filed after the appointed day in respect of the goods or services exported...after the appointed day, shall be disposed of in accordance with the provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -section (i) vide number G.S.R. 945(E), dated the 30th December, 2011, except as respects things done or omitted to be done before such supersession, the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby grants rebate of service tax paid(hereinafter referred to as rebate) on the taxable services which are received by an exporter of goods (hereinafter referred to as the exporter) and used for export of goods, subject to the extent and manner specified herein below, namely:- Provided that a) the rebate shall be granted by way of refund of service tax paid on the specified services. Explanation. - For the purposes of this notification,- (A) specified services means- (i) in the case of excisable goods, taxable services that have been used beyond the place of removal, for the export of said goods; (ii) in the case of goods other than (i) above, taxable services used for the export of said goods; but shall not include any service mentioned in sub-clauses (A), (B), (BA) and (C) of clause (l) of rule (2) of the CENVAT Credit Rules, 2004; (B) place of removal shall have the meaning assigned to it in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tification have been fulfilled; (e) service tax paid on the specified services eligible for rebate under this notification, shall be calculated by applying the rate prescribed for goods of a class or description, in the Schedule, as a percentage of the FOB value of the said goods; (f) amount so calculated as rebate shall be deposited in the bank account of the exporter; (g) shipping bill or bill of export on which rebate has been claimed on the basis of rate specified in the Schedule, by way of procedure specified in this paragraph, shall not be used for rebate claim on the basis of documents, specified in paragraph 3; (h) where the rebate involved in a shipping bill or bill of export is less than rupees fifty, the same shall not be allowed; (3) the rebate shall be claimed in the following manner, namely:- a) rebate may be claimed on the service tax actually paid on any specified service on the basis of duly certified documents; b) the person liable to pay service tax under section 68 of the said Act on the taxable service provided to the exporter for export of goods shall not be eligible to claim rebate under this notification; c) th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said goods and the service tax paid thereon, certified in the manner specified in sub-clauses (A) and (B): (A) if the exporter is a proprietorship concern or partnership firm, the documents enclosed with the claim shall be self-certified by the exporter and if the exporter is a limited company, the documents enclosed with the claim shall be certified by the person authorised by the Board of Directors; (B) the documents enclosed with the claim shall also contain a certificate from the exporter or the person authorised by the Board of Directors, to the effect that specified service to which the document pertains has been received, the service tax payable thereon has been paid and the specified service has been used for export of the said goods under the shipping bill number; i) where the total amount of rebate sought under a claim is more than 0.50% of the total FOB value of the goods exported, the procedure specified in clause (h) above shall stand modified to the extent that the certification prescribed thereon, in sub-clauses (A) and (B) shall be made by the Chartered Accountant who audits the annual accounts of the exporter for the purposes of the Companies Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and conditions in implementing the scheme as per notification; Provides for the period of limitation within which such refund claim needs to be filed; Provides for the manner in which rebate/ refund claim shall be processed by the jurisdictional officer and also the time period in which the claim has to be processed; Provides that no CENVAT Credit off the service tax paid on the input services has been taken. However, the notification does not provide for any limitation on the period in which the goods have to be exported from the date of receipt of the input service on the payment of service tax. Impugned order does not analyze the notification in dispute but has misdirected itself by going into the transitional provisions as per the Central Goods and Service Tax Act, 2017. From the plain wording of the notification it is evident that the right to claim the rebate has accrued to the appellant (exporter) on the date of payment of the service tax on input services received by him for use in the export of goods. Assistant Commissioner has in para 5 (iii) recorded a specific finding in this regard which was not disputed by the revenue in their appeal before th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dy paid the taxes on the basis that when the goods are utilised in the manufacture of further products as inputs thereto then the tax on these goods gets adjusted which are finished subsequently. Thus, a right accrued to the assessee on the date when they paid the tax on the raw materials or the inputs and that right would continue until the facility available thereto gets worked out or until those goods existed. Therefore, it becomes clear that Section 37 of the Act does not enable the authorities concerned to make a rule which is impugned herein and, therefore, we may have no hesitation to hold that the Rule cannot be applied to the goods manufactured prior to 16-3-1995 on which duty had been paid and credit facility thereto has been availed of for the purpose of manufacture of further goods. 4.7 In case of Dai Ichi Karkaria [1999 (112) E.L.T. 353 (S.C)] Hon ble Supreme Court has category laid down as follows: 17. It is clear from these Rules, as we read them, that a manufacturer obtains credit for the excise duty paid on raw material to be used by him in the production of an excisable product immediately it makes the requisite declaration and obtains an acknowledgemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vestigation, inquiry, verification (including scrutiny and audit), assessment proceedings, adjudication and other legal proceedings or recovery of arrears or remedy may be instituted, continued or enforced, and any such tax, surcharge, penalty, fine, interest, forfeiture or punishment may be levied or imposed as if these Acts had not been so amended or repealed; (f) affect any proceedings .. 4.8 The observation made by the Commissioner (Appeals) in respect of the provisions of Section 173 of The Central Goods and Service Tax Act, 2017, are in respect of the repeal of notification 41/2012-ST without even referring to the Section 1 74 (2) ibid, cannot impact the rights accrued to the appellant prior to such repeal. As is evident from the wording of the notification and the decision of the Hon ble Supreme Court the right to rebate has accrued to the appellant at the time of the receipt of the specified input services for use in the export of goods by the exporter, and such right could not have been extinguished by the subsequent event of repeal of Chapter V of the Finance Act, 1994. Interpreting the section 174 of the Central Goods and Service tax Act, 2014, Hon ble Jharkh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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