Management Consultancy and Ship Management Form Part of SEZ Unit Approval Committee’s Approved List, Refund Admissible: CESTAT [Read Order]

The Ahmedabad Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that management consultancy and ship management services are part of the SEZ Unit Approval Committee’s approved list of services, and refund of service tax paid on them is admissible.

Swan Defence and Heavy Industries Ltd., the appellant, operates from Pipavav Port in an SEZ. Refund claims they filed were partly rejected by the Commissioner (Appeals), Rajkot, on the ground that management consultancy and ship management services were not in the list of services approved by the SEZ Unit Approval Committee.

The appellant’s counsel argued that in their own earlier case the Tribunal had already held that management consultancy services were part of the list of 91 services approved on 01.02.2012, which was later clarified on 11.08.2015 to have continued without interruption. The counsel further argued that ship management services are part of the broader category “Management, Maintenance or Repair Services,” which also stood approved.

The department’s representative argued that management consultancy and ship management services were not specifically included in the default approved list and that refunds were not admissible.

The single-member bench of Judicial Member Somesh Arora observed that the clarification issued on 11.08.2015 confirmed that the 91 approved services remained valid from 01.02.2012 onwards.

The tribunal explained that ship management service is a species of the genus “Management, Maintenance or Repair Services” which was in the approved list, and thus refunds could not be denied. The tribunal held that rejection of refunds on this ground was unsustainable and directed that the refund be sanctioned with consequential relief. The appeals were allowed.

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates