MANUBHAI & CO. Vs. CST, AHMEDABAD

JUDGEMENT

(1.) THE appellants claimed refund of Rs. 2,30,622/ - under Notification No. 12/2005 -S.T., dated 19 -4 -05 being the service tax paid on input services used in the services exported by them. According to the notification appellant was required to file a declaration describing quantity, value, rate of duty and the amount of duty/tax payable on inputs actually required/description, value and the amount of service tax and cess payable on input services actually required to be used in the taxable services to be exported prior to the date of export. The refund claim has been rejected on the ground that appellant did not file the declaration prior to the export of service made by them. The declaration was submitted on 17 -7 -08 whereas export of service took place during the period from 5 -3 -07 to 2 -2 -08.

(2.) HEARD both the sides.

(3.) LEARNED Chartered Accountant on behalf of the appellants submitted that the notification is divided into two parts. The first part gives the conditions to be fulfilled for sanction of refund. The second part gives the procedure for claiming the refund. He submits that the procedural part covered by para 3.1 which requires a declaration to be filed prior to export with the Deputy Commissioner has not been fulfilled by them. He submits that it is a settled law that substantive benefit cannot be denied on the ground of procedural lapses. He relies upon the decisions of this Tribunal to support his contention and submits that the same are rendered in respect of the very same notification. On the other hand learned DR submits that the requirement of a declaration in the notification is a substantive condition and cannot be treated as a mere procedural requirement. He relies on the decision of the Honble Supreme Court in the case of Rajasthan Spinning and Weaving Mills Ltd. v. CCE, Jaipur reported in 1995 (77) E.L.T. 474 (S.C.) and Eagle Flask Industries Ltd. v. CCE, Pune reported in 2004 (171) E.L.T. 296 (S.C.). In the case of Rajasthan Spinning and Weaving Mills Ltd. it was held by the Apex Court that exemption notifications have to be construed strictly and liberal construction which enlarges the term and scope of the notification is not permissible. In the case of Eagle Flask Industries Ltd., it was held that exemption from licencing is extended subject to filing of declaration. It does not result in a situation where non filing of declaration would still render the assessee eligible for exemption. Filing of declaration is not an empty formality or mere procedural requirement.