Refund of Swachh Bharat Cess of Service Tax Allowable u/s 119(5) of Finance Act on Export Service of Basic Grade Pig Iron: CESTAT [Read Order]

The Kolkata bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that the export services of basic grade pig iron are eligible for a refund of Swachh Bharat Cess (SBC) of service tax under section 119(5) of the Finance Act, 1994. 

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 section 119 of the Finance Act, 2015 introduced the provision of collection of SBC and as per the said provision which relates to refund on exemption from tax, interest, and imposition of penalty shall be as far as may be applied with levy and collection of SBC on taxable services under Chapter V of the Finance Act. 

Also submitted that the assessee was eligible for the refund of SBC and the refund was liable to be allowed for the assessee as per the Notification. 

S.S.Chattopadhyay, the counsel for the department relied on the decisions made by the lower authorities and contended that the assessee was not eligible for the refund of SBC. 

The Bench observed that as per Notification No.41/2012 of Service Tax grants refund of service tax paid on the taxable services used for the export of goods by an exporter and since SBC had been treated as service tax, they are eligible for the refund also.  The two-member bench comprising Ashok Jindal (Judicial) and Anpazhakan (Technical) held that the assessee was eligible for the refund claim of SBC while allowing the appeal filed by the assessee.

To Read the full text of the Order CLICK HERE

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