CESTAT Allows Refund of SBC and KKC of Service Tax on export of Non-Alloy Pig Iron on ground of Cess Exemption under Exemption Notification [Read Order]

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The Kolkata bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) allowed the refund of Swatch Bharat Cess (SBC) and Krishi Kalyan Cess (KKS) of service tax on the export of non-alloy pig iron on the ground of cess exemption under the exemption notification. 

MMTC Limited, the appellant assessee was a Merchant Exporter & holder of Service Tax Registration and Import Export Code for providing the export services and applied rebate/refund claim for the export of Basic Grade Pig Iron to Rayang/Thailand under the cover of Shipping Bill and export of Non-Alloy Pig Iron from Paradeep Port in terms of Notification No.41/2012 of Service Tax. 

The assessee appealed against the order passed by the adjudicating authority to confirm the rejection of the rebate/refund claim of SBC and KKC against the assessee. 

A.D.Roy and Sanjukta Roy, the counsels for the assessee contended that the assessee filed the refund claim for the services used in the export of goods and for the service tax paid in the course of the export of goods, they are entitled to a refund of service tax as well as SBC and KKC paid in terms of Notification No.41/2012-Service Tax. Therefore, a refund claim cannot be denied. 

S.S.Chattopadhyay, the counsel for the department relied on the decisions made by the lower authorities and contended that the refund claim was not admissible in as much as there was no specific provision in the subject Notification No.41/2012-Service Tax for granting refund of the SBC and KKC. 

The Bench observed that the Notification had allowed a refund of service tax without specifying whether leviable under Section 66 or Section 66B of the Finance Act and hence, no amendment in Notification was legally required to be undertaken. 

Also observed that in the case of Government of Kerala And Another Vs. Mother Superior Adoration Convent, the court held that service tax was said to be refunded as rebate under Section 93A of the Finance Act, all the SBC and KKC that was levied as Service Tax had to be refunded whether the same was later added and/or levied as service tax or not.

While allowing the appeal, the two-member bench comprising Ashok Jindal (Judicial) and Anpazhakan (Technical) allowed the refund claim of SBC and KKC. 

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