Order Date – 30 August 2023

Parties: M/s EXL Services SEZ BPO Solutions (P) Ltd. Vs Commissioner of Customs & Central Excise, Noida

Facts – 

• The Appellant, M/s EXL Services SEZ BPO Solutions (P) Ltd., is operating from its units located in SEZ NOIDA and SEZ Jaipur. They are having centralized registration and providing taxable services under the category of Business Auxiliary Service from both locations.
• Appellant filed an application on 23.03.2011 for refund of service tax under Notification No 9/2009-ST dated 03.03.2009, in respect of the service tax paid on services used in authorized operations in SEZ during the period October 2010 to December 2010.
• The same was rejected on the ground that that the taxable services in respect of the which the claim has been made, are not mentioned in the list of specified services approved by the SEZ authorities.

Issue – 

• Whether the refund can be denied on the ground that the taxable services are not mentioned in the list of specified services approved by the SEZ authorities?

Order – 

• The Tribunal observed that it is settled law that the show cause notice should contain the specific allegation and mere mention of notification number will not suffice as held by the Hon’ble Apex Court in the case of Ballarpur Industries Ltd. [2007 (215) ELT 489 (SC)].
• When the developer of SEZ and units located in the SEZ have been given exemption from payment of all the taxes then any levy and collection of the taxes from such units is without any authority in law and thus contravenes the Article 265.
• In such a scenario, the amount so collected needs to be refunded to the person from whom such tax has been collected. The condition specified in proviso (a) to the notification only provides a manner for verification that the services in respect of which the refund claim has been made were received by the SEZ developer or the SEZ Unit.
• In the present case revenue has not disputed the receipt of these services by the SEZ Unit, hence denial of the refund claim in respect of these three services for the reason that they did not find mention in the list of specified services approved by the SEZ authority cannot be upheld.
• The issue involved in the present appeal is no longer res-integra. Similar view has been expressed by the tribunal in various cases. Hence the impugned order is set aside and the appeal is allowed.