The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad Bench observed that Refund admissible on trenching pipeline installed partly in SEZ partly outside.
The appellant, Reliance Jamnagar Infrastructure Limited has received services such as construction service, CHA Service in their SEZ on payment of service tax. Subsequently refund claim was filed under Notification No. 09/2009-ST as amended by 15/2009-ST. The Adjudicating Authority rejected the refund claim on the ground that, as regards construction service, the service was wholly consumed within SEZ. Therefore, the same is not governed by Notification No. 09/2009.
As regards the construction service related to Appeal No. ST/449/2012, the refund was rejected on the ground that trenching work for irrigation network was not fully within the SEZ and partly outside the SEZ therefore refund was claimed rejected under Notification No. 09/2009-ST. Commissioner (Appeals) upheld the rejection of the refund claims therefore the present appeal has been preferred.
The Counsel appearing on behalf of the appellant submitted that the trenching work for irrigation, she submits that service was received for the authorised operation of SEZ. The irrigation project line was installed within SEZ however, part of the same was installed outside but for the purpose of SEZ only. Therefore, even though the entire construction is not at all carried out within SEZ but it was for the SEZ, the refund is admissible.
The Coram consisting of Ramesh Nair, Judicial Member and Raju, Technical Member observed that “As regards refund of Rupees five thousand for the construction service received from Jay Khodiyar in relation to construction of trenching and pipelines, we find that the construction was exclusively for SEZ only. It is very obvious that a part of the same will be outside the premises of the SEZ but that does not mean that service was received for other than authorised operations of SEZ.”
“Accordingly, on the admitted fact that trenching pipeline installed partly in SEZ and partly outside but for use in operation of the SEZ is admissible and the refund of the same is clearly admissible” the Tribunal ruled.
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