The Chennai bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) upheld the sanctioning of service tax rebate claim on the advisory service on the grounds of refund eligibility.
Sundaram Asset Management Co. Ltd, the respondent-assessee was engaged in the activity of management of assets of various schemes of Sundaram Mutual Fund and advises on investment to clients both in India and overseas. While providing advisory services to clients abroad they received the consideration in inconvertible foreign exchange.
The revenue appealed against the order passed by the Commissioner (Appeals) for confirming the sanctioning of a rebate claim of Rs.48,82,448/- to the assessee.
R. Rajaram, the counsel for the assessee contended that When the assessee has provided advisory services to a client abroad and also received convertible foreign exchange as consideration the activity has to be considered as an export of services.
Rudra Pratap Singh, the counsel for the department contended that only if the services are used outside India it can be said that there was the export of services.
The Bench observed that the Commissioner (Appeals) had rightly discussed the issue in detail and held that the refund was eligible to the assessee. Though the decision referred by the Commissioner (Appeals) had analyzed the issues based on a circular of 2009 the reasoning given by the Commissioner (Appeals) was proper and did not require any interference. The two-member bench comprising Sulekha Beevi (Judicial) and Vasa Seshagiri Rao (Technical) upheld the sanctioning of the rebate claim filed by the assessee
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