Khimji Vishram & Sons vs Commissioner Of Service Tax, Mumbai

[Arising out of Order-in- Appeal No. BR/68-70/2012 dtd. 20/9/2012 passed by the Commissioner (Appeals) IV, Central Excise, Mumbai Zone I]

For approval and signature:

Honble Mr Ramesh Nair, Member(Judicial)

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1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the : CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether Their Lordships wish to see the fair copy : seen of the Order?

4. Whether Order is to be circulated to the Departmental : Yes authorities?

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Khimji Vishram & Sons : Appellants

VS

Commissioner of Service Tax, Mumbai. : Respondent

Appearance

Shri. R. V. Shetty, Advocate for the Appellants Shri. S.V. Nair, Asst. Commissioner(A.R.) for the Respondent

CORAM:

Honble Mr. Ramesh Nair, Member (Judicial)

Date of hearing: 20/2/2012 Date of decision 20/2/2012

ORDER NO.

Per : Ramesh Nair

These appeals are directed against common Order-in- Appeal No. BR/68-70/2012 dtd. 20/9/2012 passed by the Commissioner (Appeals) IV, Central Excise, Mumbai Zone I, wherein appeals filed by the appellant against rejection of their refund claim was rejected. The fact of the case is that the appellant filed three refund claims under Notification No. 40/2O07-ST dated 17/9/2007 and 41/2007-ST dated 6/10/2007 for amount of Rs. 1,91,141/-, Rs. 3,32,732/- and 6,48,305/- out of which claim of Rs. 24,423/-, Rs. 1,57,326/- and Rs. 1,81,447/- respectively was sanctioned and amount of Rs. 1,66,704/-, Rs. 1,75,406 and 4,66,858/- respectively were rejected by the adjudicating authority. Rejection of claims were made on the ground that as against terminal handling charges in the invoices of the service provider, it is mentioned business auxiliary service/business support service and the same not notified under Notification No. 40/2O07-ST dated 17/9/2007 as amended by Notification No. 41/2007-ST dated 6/10/2007. As regard transport services, it was contended that linkages of the goods exported with the transport service has not been established. As regard the CHA Service, the appellant failed to co-relate the nexus between CHA service with the goods exported. Aggrieved by the said order-in-original appellant filed three appeals before the Commissioner (Appeals), who concurring the views taken by the original authority rejected the appeals by the impugned order, therefore the appellant is before me.

2. Shri. R. V. Shetty, Ld Counsel for the appellant submits that as regard terminal handling charges, even though the invoices of the service provider shows the category as business auxiliary service or business support service but fact remains that the services received by the them is of terminal handling charges and therefore only the ground that invoices showing business auxiliary service or business support service can not be reason for rejection of the claim. In support, he placed reliance on this Tribunal judgment in the case of Stone Shippers Vs. Commissioner of Service Tax, Mumbai[2014-TIOL-2340-CESTAT-MUM] wherein under the identical facts relying on the judgment of Indoworth(India) Ltd., Vs. CCE, Nagpur-[2012(25) STR78(Tri-Mum) refund was allowed. As regard the transport service, he submits that the transport service in respect of which refund was claimed was exclusively used for export of goods and same can be established on the basis of lorry receipt of transport, export invoice and bill of leading etc. Therefore rejection of claim on the ground that there is no linkages between transport services and export of goods is not correct. As regard refund claim on CHA service, he submits that co-relation between CHA services and export goods can be easily established on the basis of service providers invoices, export invoices, shipping bills and bill of leading, therefore the refund of this ground also wrongly rejected.

2. Shri. S.V. Nair, Ld. Asst. Commissioner(A.R.) appearing on behalf of the Revenue reiterates the findings of the impugned order.

3. I have carefully considered the submissions made by both the sides and perused the record.

4. I find that as per the claim of the appellant all the documents have been submitted before the adjudicating authority. As regard the findings of the Ld. Commissioner(Appeals) in respect of terminal handling charges, it is observed that though the service providers registered himself for the service for business auxiliary service / business support service but description of the service mentioned in the service invoice shows that services are of port service i.e. dock fees and terminal handling charges, therefore merely because the service provider is registered for Business auxiliary service/business support service but the service received by the appellant is port service, refund is admissible to the appellant. Ratio of the judgments in the case of Stone shippers (supra) is also squarely applicable to the present case. I therefore hold that the refund claim in respect of terminal handling charges is clearly admissible to the appellant. As regard transport service, Ld. Commissioner (Appeals) has given finding that for the purpose of refund under Notification No. 40/2007 service admissible is services of transport of goods by road from ICD to Port of export by rail from ICD to Port of export [Section 65(105)(zzzp)] and on this basis it was held that service of transport claimed as refund by the appellant from various places to ICD are not covered under the said exemption notification.

In this regard I perused the Notification No. 41/2007-ST dated 06/10/2007 which was amended by Notification No 3/2008-ST dated 19/2/2008 and found that against Sr. No. 11 of the schedule to the Notification, the entry is Services provided to an exporter in relation to transport of export goods directly from the place of removal to inland container depot or port or airport, as the case may be, from where the goods are exported. The case of the appellant is admittedly pertain to the period Jan 2009 onward, during which period the above entry was prevailing therefore the contention of the Ld. Commissioner is apparently wrong. In view of the entry mentioned at Sr 11 of amended Notification No. 41/2007 ST, the appellant is entitled for the refund of service tax paid in respect of transportation right from removal of place of removal goods from the factory up to port of export. Therefore the appellant is entitled for the refund in respect of transport service. As regard the rejection of claim of the appellant in respect of CHA Service it appears that the claim was rejected for the non-submission of invoice.

However, the submission of Ld Counsel is that all the documents have been submitted therefore this fact is required to be re-examined by the adjudicating authority. In view of my above discussion the matter needs to be remanded to the adjudicating authority. I therefore set aside the order-in-appeal and remand the matter to the original authority to pass fresh order considering my above observations. Needless to say that adjudicating authority shall give reasonable opportunity to the appellant for personal hearing and submissions of documents, if any. The adjudicating authority shall dispose of the matter within a period of two months from the receipt of this order. Appeal is allowed by way of remand.

(Operative part pronounced in court)

Ramesh Nair Member (Judicial)

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