Gujarat High Court

Vodafone Idea Limited vs Union Of India on 2 January, 2025

Author: Bhargav D. Karia

Bench: Bhargav D. Karia

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                                IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                                 R/SPECIAL CIVIL APPLICATION NO. 21525 of 2019


                     FOR APPROVAL AND SIGNATURE:

                     HONOURABLE MR. JUSTICE BHARGAV D. KARIA                                     Sd/-
                     and
                     HONOURABLE MR.JUSTICE D.N.RAY                                               Sd/-

                     ==================================================

                                   Approved for Reporting                   Yes           No

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                                                  VODAFONE IDEA LIMITED
                                                          Versus
                                                   UNION OF INDIA & ORS.
                     ==================================================
                     Appearance:
                     MR ANAND NAINAWATI(5970) for the Petitioner(s) No. 1
                     MR CB GUPTA(1685) for the Respondent(s) No. 2,3
                     MR DEVANG VYAS(2794) for the Respondent(s) No. 1
                     ==================================================

                        CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA
                              and
                              HONOURABLE MR.JUSTICE D.N.RAY

                                                       Date : 02/01/2025
                                                      ORAL JUDGMENT

(PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)

1. Heard learned advocate Mr. Anand Nainawati for the

petitioner and learned advocate Mr. C.B. Gupta for respondent

Nos.2 and 3. Learned ASG Mr. Devang Vyas was appearing

earlier in the year 2019, but in place, now no one appears and

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no one has bothered to file appearance for respondent No.1

Union of India.

2. Rule. Learned advocate Mr. C.B. Gupta waives service of

notice of rule on behalf of respondent Nos.2 and 3.

3. By this petition under Articles 226 and 300A of the

Constitution of India, the petitioner has prayed for the following

reliefs:

"44(a) Your Lordships be pleased to issue a writ of Certiorari or a writ in the nature of Certiorari under Article 226 of the Constitution of India, calling for the records pertaining to the impugned Order-In-Original No. CGST/WS08/Ref-06/ST/ BSM/19-20 dated 13 August 2019 and after going into the validity and legality thereof to quash and set aside the same;

(b) Your Lordships be pleased to issue writ of mandamus or any other appropriate writ, order or direction in the nature of mandamus ordering and directing the Respondents, their subordinate, servants and agents to forthwith:

(i) withdraw and/or cancel impugned Order-In-

Original No. CGST/WS08/Ref-06/ST/ BSM/19-20 dated 13 August 2019;

(ii) sanction the rebate claim of Rs.11,54,82,738/- as filed by the Petitioner along with interest.

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(c) Pending the hearing and final disposal of this Petition, Your Lordships be pleased to direct the Respondents by an interim order of this Hon'ble Court to forthwith deposit an amount of Rs.11,54,82,738/- in this Hon'ble Court with a liberty to the Petitioner to withdraw the same, without prejudice to the Petitioner's right of refund of the actual amount along with appropriate interest;

(d) An ex-parte ad-interim relief in terms of prayer (c) above may kindly be granted;

(e) Such other and further order or orders as may be deemed just and proper in the facts and circumstances of the present case may kindly be granted."

4. The brief facts of the case are as under:

(i) The petitioner company was holding Service Tax

Registration with the Commissioner of Service Tax,

Division-II, Range XX, Commissionerate Delhi, being No.

AAACS4457QST001.

(ii) With effect from 12th February 2016, the petitioner

obtained Centralized Registration for its premises located

at Ahmedabad, falling within the jurisdiction of respondent

No.2 - Principal Commissioner of CGST, being No.

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AAACS4457QST001.

(iii) The petitioner is engaged in the business of providing

telecom services categorized under the category of

'Telecommunication Services'.

(iv) In order to provide telecommunication services to its

subscribers located outside India, Foreign Telecom

Operators (FTOs) entered into an agreement with a

telecom operator located in their jurisdiction who extends

the roaming facility to the subscribers of the FTO so as to

ensure seamless supply of services to their subscribers

located outside India. The petitioner, therefore, in normal

course of business, entered into an agreement with

various FTOs having their permanent establishment

outside India and having their establishment and business

operations outside India.

(v) The petitioner initially paid service tax on the gross

invoice value of the service exported to the FTOs located

outside India and thereafter claimed rebate of the same as

provided under Rule 5 of the Export Rules read with

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Notification No.11 of 2005 dated 19th April 2005. The

petitioner accordingly filed 7 rebate claims with the Delhi

Commissionerate in Form ASTR-1, the details of which are

as under:

Sr. Period Amount (Rs.) Date of filing No. rebate claim

1 August 2006 to 6,34,27,140 09.11.2011 March 2007 (Rebate Claim 1)

2 October 2010 to 3,90,74,456 30.09.2011 March 2011 (Rebate Claim 2)

3 April 2011 to 1,24,53,886 28.03.2012 September 2011 (Rebate Claim 3)

4 July 2011 20,515 08.02.2013 (Rebate Claim 4)

5 October 2011 1,09,086 09.05.2013 (Rebate Claim 5)

6 October 2011 to 2,52,657 26.06.2012 March 2012 (Rebate Claim 6)

7 February 2013 1,44,998 05.03.2014 (Rebate Claim 7)

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11,54,82,738

(vi) Along with the rebate claims, the petitioner submitted the

following documents:

(i) Details of invoices raised (i.e. Register for output

services) on our clients for services exported.

(ii) Copy of Export invoices (output service invoice)

along with Foreign Inward Remittance (FIRCs).

(iii) Along with the Rebate Claim 1, 2, 3 and 6, the

petitioner has also submitted ST-3 returns for the

relevant period.

(iv) Along with the Rebate Claim 1, 2, 3, 4, 5 and 6, the

petitioner has also submitted TR-6/GAR-7 challan

evidencing payment of service tax.

(vii) It is the case of the petitioner that the Assistant

Commissioner of Service Tax, Refund (Division VI), Delhi-

II issued deficiency letters in respect of rebate claim Nos.

1, 2, 3 and 6 which were replied by the petitioner in the

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year 2015 by supplying the documents requested in the

deficiency letters.

(viii) The Assistant / Deputy Commissioner of Service Tax,

Refund (Division VI), Delhi-II passed 7 separate orders

rejecting the rebate claims filed by the petitioner on 24 th

June 2015.

(ix) Being aggrieved, the petitioner preferred appeals before

the Commissioner (Appeals-I), New Delhi. The petitioner

was granted personal hearing on 22nd February 2016 by

the Commissioner (Appeals-I), New Delhi. The petitioner,

in the meantime, had obtained Centralized Service Tax

Registration within the jurisdiction of respondent No.2

with effect from 13th February 2016 and therefore, a

request was made by the petitioner to transfer the appeal

papers to the office of Commissioner (Appeals),

Ahmedabad, which ought to have exercised jurisdiction

over the petitioner on 22nd February 2016.

(x) The request made by the petitioner to transfer the files

from New Delhi to Ahmedabad was accepted and

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accordingly the appeal papers were transferred to the

office of Commissioner (Appeals), Ahmedabad.

(xi) The petitioner was thereafter granted personal hearing on

21st July 2016. The authorized representative of the

petitioner attended the personal hearing and reproduced

photocopies of the documents submitted at the time of

filing of rebate claims containing total of 26 box files.

(xii) The Commissioner (Appeals), Ahmedabad, vide order

dated 22nd July 2016, remanded the matter back to

respondent No.3 - Assistant Commissioner of CGST,

Division-VIII (Vejalpur), Ahmedabad (South) to decide the

case afresh after following the principles of natural justice.

(xiii) The petitioner, therefore, requested respondent No.3 by

letter dated 30th August 2016 to adjudicate the rebate

claims on the basis of the documents submitted by the

petitioner at the time of filing of the rebate claims.

However, respondent No.3 informed the petitioner that all

the documents with respect to 7 rebate claims filed by the

petitioner were not available with the office of respondent

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No.3. The petitioner, therefore, by letter dated 28 th

October 2016, re-submitted the following documents:

(i) List of rebate claims filed by the petitioner.

(ii) Copies of all invoices and FIRCs pertaining to Rebate

Claim 2 and 3.

(iii) Copies of Orders-in-Original passed by the Assistant /

Deputy Commissioner of Service Tax, Refund

(Division VI), Delhi-II.

(xiv) The petitioner thereafter, by letter dated 3 rd February

2017, once again requested respondent No.3 to adjudicate

the rebate claims on the basis of documents submitted by

the petitioner.

(xv) It appears that the office of the Assistant / Deputy

Commissioner of Service Tax, Refund (Division VI), Delhi-

II, vide letter dated 19th January 2017, had informed

respondent No.3 that the documents of rebate claims of

the petitioner were sent by Speed Post, however, the same

were never received by the office of respondent No.3.

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(xvi) Thereafter, respondent No.3, vide letter dated 20 th

February 2017, requested the petitioner to submit the

original documents pertaining to rebate claims and

refused to accept the photocopies of original documents

submitted by the petitioner and further instructed the

petitioner to liaise with the office of Assistant / Deputy

Commissioner of Service Tax, Refund (Division VI), Delhi-

II and get the documents to be transferred by the office of

respondent No.3.

(xvii) Therefore, the petitioner, vide letter dated 21 st March

2017, informed respondent No.3 that it has already

submitted all the supporting documents along with the

rebate claims and requested respondent No.3 to pass the

order on the basis of documents re-submitted by the

petitioner.

(xviii) Respondent No.3, however, without taking into

consideration the request of the petitioner, by order dated

9th May 2017, rejected all the 7 rebate claims filed by the

petitioner on the ground that original files of the rebate

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claims submitted by the petitioner were not received from

the office of the Assistant / Deputy Commissioner of

Service Tax, Refund (Division VI), Delhi-II.

(xix) Being aggrieved by Order-in-Original, the petitioner filed

an appeal before the Commissioner (Appeals),

Ahmedabad, who, by order dated 29th January 2018,

remanded the matter back to the Adjudicating Authority to

decide the case afresh after following principles of natural

justice. The Commissioner (Appeals), while remanding the

matter back to respondent No.3, held as under:

"7. I have carefully gone through the facts of the case on records, grounds of appeal in the Appeal Memorandum and oral submissions made by the appellants at the time of personal hearing. Various citations and written submission submitted at the time of personal hearing, I find that the claims were rejected on the ground of limitation without going into the merit. Though in discussion at para 7.5 to 7.10 of the impugned OIO the adjudicating authority has discussed that the original documents are not received from Service Tax Delhi, and without going into the merits the matter is being decided.

8. Regarding the issue of rejection of the claims i.e. on the ground of limitation, the applicability of Section

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11B of the Central Excise Act, 1944 was not properly discussed in the impugned order. There are several judgments for and against the applicability of limitation on the claim of rebate which need to be discussed properly. Without verification of the documents the matter has been decided very vaguely as time barred. Further it is observed that adjudicating authority has decided the case in remand in a very casual approach i.e. seven OIA's remanded has been decided vide single order, which is an astonishing act.

9. Regarding the issue of non-submission of required documents, the adjudicating authority has not properly discussed the same. The appellants have stated that they have submitted all the required documents along with the rebate claims. I believe that this issue needs to be properly verified by the present adjudicating authority. It is evident that the adjudicating authority has made efforts to get the record transferred from the Service Tax Delhi, but simply quoting that the Service Tax Delhi has sent the records by speed post to "assistant Commissioner Gujarat", but not received by them does not conclude that the records are not available or not filed by the appellant. It is also fact that the records were submitted to proper authority at Delhi, to transfer the same is not the responsibility of the appellant but of the department. It is needless to say that sincere efforts could have resulted in finding the records; it is quite unbelievable that the records sent through Speed Post are not traceable. It is directed to take up the matter with proper authority if required with higher

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authority of the department at Delhi, and with postal departmental to trace the consignment of speed post. Simultaneously on the basis of documents submitted by the appellants adjudicating authority should examine from legal point of view/merit of eligibility of rebate, it is also directed to the appellant to give cooperation to the department for such purpose. Substantial rights of the assessee if any cannot be denied without verification and natural justice.

10. In light of the above discussion, I remand back the matter to the present adjudicating authority to decide the case afresh preferably within four weeks from the receipt of this order, following the principle of natural justice as per the discussion above."

(xx) Pursuant to the above Order-in-Appeal dated 29th January

2018, respondent No.3, by letter dated 19th February

2019, called upon the petitioner to produce the original

copies of all the documents to take appropriate decision in

respect of the rebate claims.

(xxi) In reply, the petitioner, by letter dated 6 th March 2019,

informed respondent No.3 that all requisite documents

were already submitted at the time of filing of rebate claim

and further by letter dated 28th October 2016, the

petitioner had re-submitted copies of rebate claim for

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certain periods and also informed respondent No.3 that

the Commissioner (Appeals), Ahmedabad had directed to

decide the rebate claim on the basis of the documents

submitted by the petitioner in the Order-in-Appeal.

(xxii) It appears that respondent No.3, without following the

directions issued by the Commissioner (Appeals) in the

order dated 29th January 2018, once again requested the

petitioner to provide original copies of all the documents

by letter dated 7th March 2019.

(xxiii) During the course of personal hearing on 11 th April 2019,

the authorized representative of the petitioner made

additional submissions requesting respondent No.3 to

consider the submissions already made during the

adjudicating stage and pass the order accordingly without

insisting for submissions of original copies as ordered by

the Commissioner (Appeals), Ahmedabad.

(xxiv) It is astonishing and surprising that respondent No.3 -

Assistant Commissioner of CGST, Division-VIII (Vejalpur),

Ahmedabad (South) in total disregard and ignoring the

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directions issued by the Commissioner (Appeals),

Ahmedabad, passed the impugned order dated 13 th August

2019 rejecting all 7 rebate claims filed by the petitioner in

the absence of original documents submitted by the

petitioner at the time of filing of rebate claim observing as

under:

"26. I also find that this office has been given 3 personal hearings to the assessee on 26.03.2019, 01.04.2019 & 10.04.2019 as a natural justice. Further, this office has also been requested the Assistant Commissioner, Service Tax, Div-VI, Delhi to provide original documents vide letter dated 05.09.2016 & several reminders dtd. 24.10.2016, 15.11.2016, 25.11.2016 & 13.01.2017. I find that Assistant Commissioner, Service Tax, Div-VI, Delhi was unable to provide the requested documents as per their letter F. No. CNDL-II/ST/Div-VI/MiscCorres/2015 letter dated 19.01.2017. As per the said letter it is also find that the concerned post office is also unable to provide the information/documents, since as per post office staff the complaint regarding non delivery of any item (files in this case) can be done within 45 days of the dispatch and records of the speed post are maintained for 6 months only. Therefore, there is no way to ascertain the status of the files by the post office also. Now tehre is no scope to find the required documents from the Service Tax, Delhi and or from the post office Delhi.

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27. I find that the asssessee has submitted the photocopies of documents (26 box files) of 2 rebate claims out of 07 rebate claims i.e. for the claim of Rs.1,24,53,886/- for the period Apr 2011 to Sep 2011 (12 Box files) and for the claim of Rs.3,90,74,456/- for the period Oct 2010 to Mar 2011 (14 Box files) vide their letter dtd. 28.10.2016. On scrutiny of the said documents it is observed that there were only two types of documents i.e. Invoices and Foreign Inward Remittance Certificate (FIRC). These documents are not sufficient for rebate claim. The all essential documents like Export Invoices, Payment Proof, Cenvat Register/GAR-7/TR-6 Challans, FIRCs & Service Agreement/Contracts held with the Foreign Service Recipients etc. were not submitted by the assessee. On scrutiny of the said documents, it was found that there were certain deficiencies/ambiguities in respect of the conditions and procedures laid down in the Notification No. 11/2005-Service Tax dated 19.04.2005. The said assessee still failed to provide the other required essential documents. As the party has not submitted the essential documents, from which the nature of the services rendered exported by them could be ascertained, the nature of the party's service is not ascertainable and as the nature of the output services is not ascertainable, ti is not possible to now whether these services qualify as 'export' under the Export of Service Tax Rules, 2005 or not. On verification of the said documents it is observed that the assessee i.e. M/s. Vodafone Idea Limited (previously known as M/s. Vodafone Mobile Services Limited) is not eligible for

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rebate of Rs.5,15,28,342/-, due to non availability of essential required documents as well as original documents. Accordingly, the said rebate claim cannot be sanctioned to the assessee.

28. I find that the assessee has submitted the original documents at Service Tax Office, Delhi which are required for sanctioning the rebate claim, but this office was unable to receive the original documents from the Service Tax Office, Delhi, as mentioned above. In absence of those ORIGINAL files which has been submitted by the said claimant to Service Tax, New Delhi, this office cannot proceed with the directions of the Hon'ble Commissioner (Appeals) with respect to the adjudication of these rebate claims.

29. Further, it is not out of place to mention here, that I pass the following order without going into merit of the case since this office do not have any original refund claim papers. In view of the above, I pass the following order."

(xxv) The aforesaid observations made by respondent No.3 are

contrary to the directions issued by the Commissioner

(Appeals) in the order dated 29th January 2018 to the effect

that respondent No.3 was supposed to examine the

eligibility of the rebate claims filed by the petitioner on the

basis of the documents submitted by the petitioner and the

petitioner was also directed to render cooperation for such

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purpose.

(xxvi) It appears that respondent No.3 never called upon the

petitioner to provide documents as the original documents

filed by the petitioner were not found or being transferred

from Delhi as observed in para 26 of the impugned order.

Respondent No.3, therefore, could not have rejected the

claim only in the absence of original files which were

submitted by the petitioner at Delhi to the Service Tax

Department at Delhi. Such approach of respondent No.3 is

in fragrant breach of the directions issued by the

Commissioner (Appeals) to pass the eligibility of rebate

claim filed by the petitioner in the year 2015.

5. Learned advocate Mr. Anand Nainawati for the petitioner

referred to the further affidavit filed by the petitioner so as to

provide the list of documents to be filed before respondent No.3

for adjudication of rebate claims and submitted that the

petitioner is having photocopies of following documents which

can be submitted before respondent No.3:

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Period Amount Documents details

2006-07 6,34,27,140/- Copies of Invoice as available along with excel sheet of FIRC details

2010-11 3,92,19,454/- Copies of Invoice as available along with excel sheet of FIRC details

2011-12 1,28,36,144/- Copies of Invoice. Copies of FIRCs and excel sheet of FIRCs

6. Referring to the above details, it was submitted that the

petitioner shall submit such documents within stipulated time as

may be prescribed by this Court so as to enable respondent

No.3 to adjudicate the rebate claims filed by the petitioner.

7. On the other hand, learned advocate Mr. C.B. Gupta for

respondent Nos.2 and 3 submitted that if the petitioner submits

such documents within a period of four weeks, respondent No.3

shall decide the rebate claims filed by the petitioner within a

reasonable time as may be prescribed by this Court. Learned

advocate Mr. Gupta referred to the reply affidavit of the

respondents dated 31st December 2024 on the following

averments of the affidavit:

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"4. That, the adjudicating authority, viz., Assistant Commissioner of Central GST, Division-VIII, Ahmedabad South, vide letter dated 19.02.2019, called for the original documents from the petitioner, to decide the matter. The petitioner, vide letter dated 06.03.2019, informed that original documents were submitted by them at the time of filing of Rebate Claim at Service Tax Delhi. On enquiry with the Service Tax, New Delhi Office, it was informed that the documents / records / files had already been dispatched by Speed Post on 04.03.2016 to Service Tax, Ahmedabad Office.

However, the required documents / records / files were not received by the present adjudicating authority from the Service Tax, new Delhi office or from Kalkaji Post Office, Delhi.

5. That, the petitioner later on submitted the photocopies of documents (26 Box Files) of only 2 Rebate Claims, i.e., for Rebate Claim of Rs.1,24,53,886/- of April, 2011 to September, 2011 period (12 Box Files) and for Rebate Claim of Rs.3,90,74,456/- for October, 2010 to March, 2011 period (14 Box Files) before the present adjudicating authority, which contains only two types of documents i.e. Invoices and Foreign Inward Remittance Certificate (FIRC).

6. That, in order to decide the Rebate Claims, following documents are required:

                             i.       Export Invoices
                             ii.      Payment Proof (CENVAT Register / TR-6 / GAR-7
                                      Challans)
                             iii.     Foreign Inward Remittance Certificate (FIRC)
                             iv.      Service Agreement / Contracts held with the Foreign






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                                      Service Recipients.

7. That, the aforesaid documents are required to ensure that the conditions and limitation prescribed in Notification No.11/2005-Service Tax dated 19.04.2005 are fulfilled and to decide the Rebate claim. In absence of essential documents and the documents so far furnished by the petitioner do not suffice for ascertaining the nature of petitioner's service and it is not possible to know whether these services qualify as 'export' under the Export of Service Tax Rules, 2005 or not.

8. That, 6 Rebate Claims were rejected by the Assistant Commissioner of Service Tax, Division-VI, Delhi-II Commissionerate on the ground of limitation under Section 11B of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994. Therefore, those 6 Rebate Claims are subject to limitation provided under Section 11B of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994, on submission of essential documents."

8. Referring to the aforesaid affidavit, it was submitted that

the respondent authority shall carry out adjudication process in

accordance with law on submission of essential documents by

the petitioner.

9. Having heard learned advocates for the respective parties

and considered the facts of the case, respondent No.3 has

already pre-determined its mind to reject the rebate claims filed

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by the petitioner as stated in para 8 of the affidavit reproduced

hereinabove on the ground of limitation under section 1B of the