Order Date – 31 January 2024

Parties: M/s Baba Super Minerals Private Limited Vs The Commissioner, Central Excise & CGST, Jaipur

Facts – 

• The Appellant, M/s Baba Super Minerals Private Limited, was served with a show cause notice dated 12.10.2021 the appellant appeared to have contravened the provisions of Section 67, 68 and 70 of the Act read with Rule 6, 7 and Rule 2(I)(d)(i) of the Service Tax rules, 1994 and was liable to pay service tax on freight paid for the inward of the goods. 
• The original adjudicating authority confirmed the entire demand with penalty.

Issue –

• Whether the demand of service tax tax on freight paid for the inward of the goods is proper?

Order –

• The Tribunal observed that plain reading of the said notification makes it clear that exemption from service tax is provided under reverse charge to an exporter for the transport of goods from any Inland Container Depot to a port or Place of removal to ICD. It is noted that the said notification does not provide any exemption for the receipt of goods into the factory. Consequently, any availment of exemption of service tax on such inward receipt of goods is incorrect.
• Once the EXP-2 was filed, the responsibility lies with the Department to examine/ scrutinize the returns in a timely manner, and point out any shortfall/discrepancies to the exporter/appellant. The Department never raised any objection regarding any irregularity or highlight that invoices were not filed. Further, the Department has not brought any evidence on record to show that the appellant had suppressed any material fact in order to evade the payment of service tax. This was not done and thereafter to allege suppression with an intent to evade payment of tax to justify the demand cannot be upheld.
• Accordingly it was held that the demand is barred by limitation. Accordingly, the impugned order is set aside and the appeal is allowed.