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Judgment
Revenue is in appeal against Order-in-Appeal dated 13.04.2009, in terms of which refund of Rs.30,276/- was allowed to the respondent under the
Notification No.41/2007-ST, dated 06.10.2007. Revenue has contended that the said refund was allowed illegally in-as-much-as the refund was filed
by the respondent while the exports were made by the merchant exporter and therefore the refund should have been filed by the merchant exporter.
Ld. advocate for the respondent stated that the refund was admissible to it and cited the judgement of Hon'ble Supreme Court in the case of Gee
Pee Agri Pvt. Ltd. Vs. CCE [2015 (38) STR 449 (SC)] in its support.
We have considered the contentions of both sides. It needs to be appreciated that the issue involved is whether the respondent was eligible for
exemption of Notification No.41/2007-ST, dated 06.10.2007. There is no doubt that the service tax was paid on GT A service by the respondent and
the goods were transported directly from the factory to the port. In this case, there is a merchant exporter involved, but the merchant exporter cannot
claim the refund of service tax that was not paid by him. Seen in the context the provisions of clause 2(b) of the Notification, which has to be read
harmoniously with the provisions of clause 2(a), once it is settled that the respondent was eligible for the benefit of exemption Notification No.41/2007-
ST the sanction of refund is only the operationalisation of the said exemption. In this regard, we find that the Hon'ble Supreme Court in the case of
Gee Pee Agri Pvt. Ltd. Vs. CCE (supra) has held as under:-
We have heard learned counsel for the parties. On 13th January, 2015, we had requested the learned Additional Solicitor General to
check up whether the refund of service tax can be made either to the petitioner or to the merchant exporter in the facts of this case.
It is quite clear that refund of service tax is due either to the petitioner or to the merchant exporter. There is some dispute about who is
entitled to the refund of service tax, but in any case, the respondents cannot hold the service tax since they are not entitled to do so.
Having heard learned counsel, in our opinton, the service tax should be refunded to the petitioner within six weeks. In case, the merchant
exporter has any issue in this regard with the petitioner, he can always take up the matter before an appropriate forum.
In the light of the analysis above, we do not find any merit in the appeal of Revenue and the same is therefore dismissed.