Delhi High Court
Kultar Exports Through Its ... vs Commissioner Of Central Excise, ... on 30 January, 2020
$~9.
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Decided on: 30th January, 2020.
+ SERTA 30/2016
KULTAR EXPORTS THROUGH: ITS PARTNER ..... Appellant
Through: Ms.Anjali Gupta, Adv. with
Mr.Jitendra Singh, Ms.Vipasha Srivastava,
Advs.
Versus
COMMISSIONER OF CENTRAL
EXCISE, DELHI-I .... Respondent
Through: Mr.Amit Bansal, SSC with
Mr.Aman Rewaria, Ms. Vipasha Mishra,
Advs.
CORAM:
HON'BLE THE CHIEF JUSTICE
HON'BLE MR. JUSTICE C.HARI SHANKAR
JUDGMENT
: D.N. PATEL, Chief Justice (Oral)
1. This Appeal has been preferred under Section 35-G of the Central
Excise Act, 1944 (hereinafter "the Act") read with Section 83 of Chapter V
of the Finance Act, 1994, by the Appellant - M/s Kultar Exports through its
partner, Sh. Kultar Singh against the judgment and Final Order dated 9th
October, 2015 passed by the Customs, Excise and Service Tax Appellate
Tribunal, Principal Bench, New Delhi (hereinafter "CESTAT") in Service
Tax Appeal No. ST/3965 of 2012 whereby CESTAT upheld the Order
passed by Commissioner (Appeals), Central Excise, Delhi - I dated 6th
September 2012.
Signature Not Verified
Digitally Signed By:PANKAJ
KUMAR
Location:
Signing Date:12.03.2020 12:44
2. This Appeal was admitted by this Hon'ble Court vide Order dated 10th
February, 2017,whereby the following question of law was framed:-
"Did the CESTAT fell into error in holding that the Appellant
was not entitled to refund on account of bar of limitation in the
facts and circumstances of the case?"
3. The Appellant M/s Kultar Exports is the exporters of general
merchant goods like fabrics, readymade garments artificial jewellery etc.
The Appellant exported goods i.e. educational books in the months of July
2008 to March 2009 wherein the Appellant allegedly received services from
a foreign commission agent and service tax was paid on a reverse charge
basis. Pursuant to the same, the Appellant filed ST-3 returns on 15th June,
2010.
4. The Appellant on 10th December, 2010, filed an application for refund
of the paymentof service tax of Rs. 16,103, for the period of July 2008 to
September 2008 and Rs. 6,83,112 for the period of October 2008 to March
2009 under Notification No. 41/2007-ST dated 6th October 2007 (amended
by the notification No. 17/2008-ST dated 1stApril 2008) wherein vide the
amendment, S.No. 15 was added in the Schedule providing for exemption
on taxable services of a commission agent located outside India obtained by
an exporter in India for sale of goods, claimed refund as per exemption
under S. No. 15 of the said notification.
5. The application of the Appellant was rejected by the Assistant
Commissioner (Excise) vide Order dated 28th January, 2011, holding that
apart from not having submitted the requisite documents as stated in the
Signature Not Verified
Digitally Signed By:PANKAJ
KUMAR
Location:
Signing Date:12.03.2020 12:44
aforesaid notification, No. 41/2007-ST, the appellant's claim was time
barred as having not been submitted within the prescribed period of six
months from the end of the relevant quarter when the goods have said to
have been exported. The Assistant Commissioner noted that the Appellant
had failed to fulfil the conditions as required under Notification No. 41/2007
- ST, and thus dismissed the application.
6. The Appellant thereafter, filed an Appeal against the same, which was
dismissed by the Commissioner (Appeals) vide Order dated 6th December,
2009 noting the non-compliance with the substantive requirements of clause
2 (e) of the Notification No. 41/2007-STof submitting the requisite
documents within the time as stipulated in the said notification, and thus
being time barred.
7. Moreover, the Commissioner has noted that as per the Circular No.
112/06/2009 - ST dated 12th March 2009 wherein it has been so clarified
that the limitation period is to be computed form the date of the exports, the
application by the Appellant was time barred and thus did not comply with
the substantive condition given in the Notification.
8. The Appellant challenged the aforementioned Order-in-Appeal before
CESTAT, which, by its Final Order and judgment dated 9th October, 2015
upheld the Order by Commissioner Appeal and held that the Appellant's
application was time barred.
9. Against which, the present appeal has been preferred.
10. We have heard learned counsel for the Appellant, Ms. Anjali Gupta,
and Mr. Amit Bansal, Senior Standing Counsel, for the Respondent, at
length.
Signature Not Verified
Digitally Signed By:PANKAJ
KUMAR
Location:
Signing Date:12.03.2020 12:44
11. Ms. Anjali Gupta,learned counsel for the Appellant contends that the
refund claim was filed within one year of the date of payment of service tax
as required by Section 11B of the Act, was complied with and thus, the
Appellants claim cannot be denied.
12. Ms. Anjali Gupta contends that substantial benefit cannot be denied
on the ground of mere technical breaches. She places reliance on Formica
India v. Collector of Central Excise1.
13. Moreover, the counsel contends that the Appellant's claim should not
be disallowed merely because of the non-compliance of technical grounds
when the Appellanthas complied with the substantial requirements of the
Notification No. 41/2007-ST.
14. Per contra, Mr. Amit Bansal, Senior Standing Counsel, for the
Respondent has argued the Notification has to be treated as part of the
Statute in light of the judgements of the Hon'ble Supreme Court, and must
be strictly interpreted.
15. Mr. Amit Bansal places reliance on Saraswati Sugar Mills v.
Commissioner of Central Excise, Delhi - III2, stating that the conditions, as
provided for, in the Exemption Notification have to strictly interpreted and
non-compliance of the same would disentitle the Appellant from the benefits
as provided thereunder.
16. Furthermore, Mr. Amit Bansal contends that the time limit as
provided for, are not only procedural requirements but substantive
requirements which should have been complied with and as the Appellant's
1995 (77) ELT 0511
2011 (270) E.L.T. 465 (S.C.)
Signature Not Verified
Digitally Signed By:PANKAJ
KUMAR
Location:
Signing Date:12.03.2020 12:44
claim had been filed after the prescribed period, and thus Appeal was rightly
rejected by CESTAT.
17. It is trite, that while interpreting exemption notifications, such
notifications have to be interpreted, stricto sensu3.
18. The Supreme Court in Saraswati Sugar Mills2, has affirmed this
principle, assailing in paragraph 7, as follows:
"7. ... A party claiming exemption has to prove that he/it is
eligible for exemption contained in the notification. An
exemption notification has to be strictly construed. The
conditions for taking benefit under the notification are also to
be strictly interpreted. When the wordings of notification is
clear, then the plain language of the notification must be given
effect to. By way of an interpretation or construction, the Court
cannot add or substitute any word while construing the
notification either to grant or deny exemption. The Courts are
also not expected to stretch the words of notification or add or
subtract words in order to grant or deny the benefit of
exemption notification. In Bombay Chemicals (P) Ltd. vs. CCE
- (1995) Supp (2) SCC 646, a three Judge Bench of this Court
held that an exemption notification should be construed strictly,
but once an article is found to satisfy the test by which it falls in
the notification, then it cannot be excluded from it by
construing such notification narrowly"
19. Therefore, the clause 2 (e) of the Notification No. 41/2007-STmust be
applied strictly, and the Appellant cannot selectively seek relief of the said
notification. The CESTAT has passed a laconic, well-reasoned and thorough
order upholding the order of the Commissioner (Appeals), which merits
absolutely no interference by us.
Commissioner of Customs (Import), Mumbai v Dilip Kumar & Co. (2018) 9 SCC 1; Commissioner of Central
Excise v Hari Chand Shri Gopal& Others (2011) 1 SCC 236; Commissioner of Central Excise v Mahaan Dairies
(2004) 11 SCC 798
Signature Not Verified
Digitally Signed By:PANKAJ
KUMAR
Location:
Signing Date:12.03.2020 12:44
20. Therefore, the question of law raised in this appeal is answered
against the Appellant and in favour of the Respondent and this appeal is
hereby dismissed.
CHIEF JUSTICE
C.HARI SHANKAR, J
JANUARY 30, 2020
'anb'
Signature Not Verified
Digitally Signed By:PANKAJ
KUMAR
Location:
Signing Date:12.03.2020 12:44
