ST - Refund - Irrespective of provision of service and raising invoices, export is completed only when convertible foreign exchange is received - period of one year to be reckoned from this date: CESTAT
By TIOL News Service
MUMBAI, FEB 06, 2018: THESE are Revenue appeals.
The Commissioner (Appeals) held that the refund claim filed by the respondent under Rule 5 of CCR, 2004 is not time barred by referring to amending Notification No. 14/2016-CE(NT) dated 01.03.2016 whereby the period of one year for filing the refund was substituted to read - from the date of receipt of payment in convertible foreign exchange.
The contention of the department is that as per the un-amended provisions of Notification No.27/2012-CE (NT) dated 18/06/2012, the one year period should be reckoned from the date of invoice for the service exported. That since the notification No. 14/2016-CE(NT) was effective from 01.03.2016 whereas the period of refund involved in the present case is January 2014 to March 2014, therefore, the Commissioner(A) had erred in applying the amendment of 01/03/2016 for the period of the impugned refund.
The respondent assessee submitted that even as per the un-amended provision, the refund u/r 5 was required to be filed within one year as specified in Section 11B of CEA, 1944; that as per Section 11B of the CEA, 1944, the limit of one year is from the date of export; that in case of export of service, the date of export is the receipt of remittance of convertible foreign currency, against export of service. Inasmuch as since the respondents had admittedly filed the refund within one year from the receipt of convertible foreign exchange therefore, refund is within time limit, the respondent pleaded.
Paragraph 3(b) of the notification 27/2012-CE(NT) dated 18.06.2012 (as existing before its amendment) read thus -
| 3(b) the application in the Form A along with documents specified therein and enclosures relating to the quarter for which refund is being claimed shall be filed by the claimant, before the expiry of the period specified in section 11B of the Central Excise Act, 1944 (1 of 1944) |
The Bench adverted to the same and observed -
"…As per plain reading of the above para it is seen that the refund claim should be filed before the expiry of the period specified in Section 11B of the Central Excise Act, 1944. As per Section 11B, the prescribed period is one year from the relevant date. In case of export of service in terms of Rule 3 of Export of Taxable Service Rules, the export of taxable service means payment for such services provided is received by the service provider in convertible foreign exchange. As per these provisions irrespective of provision of service and raising invoices therefore the export is completed only when convertible foreign exchange is received by the service provider against the service exported. Accordingly, the period of one year, in case of export of service, shall be reckoned from the date of receipt of foreign exchange and not from any other date. In the admitted fact of this case, the refund claims were filed within one year from the date of receipt of foreign exchange. Therefore, irrespective of whether the amendment provision was brought from 01/03/2016, the refund claim filed by the respondent is well within the period specified under Section 11B. Therefore, the refund is not time barred…"
Placing reliance on the decision in Bechtel India Pvt. Ltd. - 2013-TIOL-1977-CESTAT-DEL, the Bench noted that the issue in hand is already covered and, therefore, the impugned orders were upheld and the revenue appeals were dismissed.
(See 2018-TIOL-458-CESTAT-MUM)
