CESTAT Larger Bench rules that relevant date for purposes of deciding time limit for consideration of refund claims under Rule 5 of CENVAT Credit Rules may be taken as end of quarter in which FIRC (payment) is received, where refund claims are filed on quarterly basis; Rejects Revenue’s stand that date of receipt of foreign exchange must be considered as relevant date and that there is no justification to extend such date till end of the quarter;
Considering the provisions of Notifications issued under Rule 5, viz. Notification No. 5/2006-CE (NT) and Notification No. 27/2012-CE (NT), Larger Bench observes that “completely ignoring the provisions of Section 11B may not be appropriate”; Notes that definition of relevant date in Section 11B of Central Excise Act does not specifically cover cases of export of services, hence it necessary to interpret the provisions constructively so as to give meaning such that their objective i.e. to grant refund of unutilized CENVAT credit is facilitated;
Referring to Service Tax Rules as well as Export of Service Rules, Larger Bench observes that since export of services is completed only with receipt of consideration in foreign exchange, the date of FIRC is definitely relevant; Notes that AP HC has held that date of receipt of consideration may be taken as relevant date in case of Hyundai Motors, but Tribunal in case of Sitel India Ltd. has observed that relevant date can be taken as end of quarter in which FIRC is received since refund claim is filed for the quarter; While Larger Bench finds Revenue’s submission that relevant date in case of service exports may be adopted on same lines as amendment carried out in Notification No. 27/2012-CE (NT) w.e.f March 1, 2016, to be an attractive proposition, it refers to observations of SC Constitution Bench in case of Vatika Township which laid down guideline that any beneficial amendment to statute may be given effect retrospectively but any provision imposing burden or liability on public can be viewed only prospectively; Resultantly, Larger Bench reverts the matter to regular benches for deciding respective appeals.
Citation: [ TS-35-CESTAT-2018-ST ]