Circular No. 187/6/2015-Service Tax
F. No. 137/62/2015-Service Tax
Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise & Customs
Service Tax Wing
New Delhi, dated 10th November, 2015
All Principal Chief Commissioners of Central Excise
All Chief Commissioners of Central Excise/Service Tax
Principal Directors General of Goods & Services Tax/Systems/ Central Excise Intelligence
Director General of Audit/Tax Payer Services
All Principal Commissioners/Commissioners of Central Excise/Service Tax
All Commissioners of Central Excise/Service Tax(Audit)/ Principal Commissioners/Commissioners LTU, Joint Secretary TRU-I/TRU-II/Review Commissioner Central Excise/Legal/PAC/Taxpayer Services
Subject: Speedy disbursal of pending refund claims of exporters of services under rule 5 of the CENVAT Credit Rules, 2004
The Board has been issuing instructions from time to time relating to the sanction and disbursal of refund claims under various notifications. A simplified procedure for sanction of refund for select categories of exporters was outlined vide Circular No. 828/5/2006-CX dated 20-4-2006 issued from F. No. 268/4/2005-CX-8. This year having been declared as the Year of Taxpayer Services, the Board has accorded primacy to speedy sanction of refunds in case of export of services. Keeping in mind the various legal changes in service tax since 2006 and the various representations received in this regard, I am directed to inform you that the following scheme has been drawn up to fast track sanction of refund of accumulated CENVAT credit to exporters of services. This scheme is not a substitute for the various notifications but is meant to complement them and is aimed at enabling ease of doing business.
2.0 Applicability of the scheme
2.1 This scheme is applicable to service tax registrants who are exporters of services, with respect to refund claims under rule 5 of the CENVAT Credit Rules, 2004, which have been filed on or before 31-3-2015, and which have not been disposed of as on date of the issue of this circular. Such registrants will be referred to as ‘claimants’ in the subsequent paragraphs.
2.2 The phrase ‘disposed of ’ in this context refers to either sanction of refund or denial, either in whole or in part, by way of an adjudication order. Refunds which had been finalized earlier by issuance of an adjudication order but have been remanded back to the original sanctioning authority will not be covered under this scheme since re-examination of such claims will have to be done strictly in terms of the remand order of the Commissioner (Appeals)/ CESTAT/ High Court.
3.0 Additional documents to be submitted (i.e. in addition to those required to be filed along with the claim)
3.1 A certificate from the statutory auditor in the case of companies, and from a chartered accountant in the case of assessees who are not companies, in the format given in Annexure-1.
3.2 An undertaking from the claimant in the format given in Annexure-2.
4.0 Operation of the scheme
4.1 On receipt of the documents referred to in paragraph 3.1 and 3.2 above in respect of pending claims, the jurisdictional Deputy/Assistant Commissioner will give a dated acknowledgement to the claimant. He will then make a provisional payment of 80% (eighty per cent) of the amount claimed as refund, within five working days of the receipt of the documents.
4.2 The letter intimating the provisional payment should be in the format given in Annexure-3. It is clarified that this payment of 80% of the refund amount shall be purely provisional, based on the documents referred to in paragraphs 3.1 and 3.2 above and without prejudice to the department’s right to check the correctness of the claim in terms of the relevant notification and recover any amount which has been provisionally paid. It is also clarified that the decision to grant provisional payment is an administrative order and not a quasi-judicial order and should not be subjected to review.
4.3 After making the provisional payment, the jurisdictional Deputy/Assistant Commissioner shall undertake checking the correctness of the refund claim in terms of the relevant notification.
4.4 During the course of verification, it may appear that a part of the amount claimed as refund is inadmissible. In such cases, a show cause notice (SCN) has to be issued asking the claimant to show cause why the inadmissible amount should not be denied and wherever relevant, why any amount which has been provisionally paid should not be recovered. However, prior to the issuance of such a SCN, the claimant may be intimated about the inadmissible amount so that he has an opportunity to avail of the provisions of section 73(3) of the Finance Act, 1994. A speaking, appealable order will have to be passed with respect to the SCN. This order will be reviewed by the jurisdictional Commissioner.
4.5 If during review of the refund order, any further amount is found to be inadmissible, then, apart from filing an appeal for setting aside or modifying the relevant portion of the order, a SCN will also have to be issued for the amount not covered by the original SCN. However, prior to the issue of such a SCN, the claimant may be intimated about the inadmissible amount so that he has an opportunity to avail of the provisions of section 73(3) of the Finance Act, 1994.
5.0 Monitoring and reporting
5.1 An MIS report in the format specified in Annexure-4 may be sent by the tenth of every month by email to firstname.lastname@example.org
5.2 Principal Commissioners/Commissioners should ensure that the provisional payment of refunds is done strictly in terms of the time lines specified and that there are no complaints regarding delays. They should also ensure that the staff dealing with refunds are adequately familiarised about this scheme so that it operates smoothly.
6.1 Principal Chief Commissioners/Chief Commissioners should ensure that the contents of this circular are brought to the notice of the claimants as well as the departmental officers.
Under Secretary (Service Tax)
The Deputy/Assistant Commissioner of Central Excise/Service Tax
1.0 This is to certify that for M/s____________ , STC__________No.
1.1 The refund claim for Rs for the quarter is complete in all aspects with all the relevant documents and has been filed within the prescribed time limit.
1.2 The amount of Rs.____________ claimed as refund for the quarter______________ by M/s. ____________ in their application for refund dated_________ is correct as per their books of accounts and relevant records and the same is in accordance with the provisions of rule 5 of the CENVAT Credit Rules, 2004, read with the notification no. ____________ issued thereunder.
1.3 M/s___________is eligible to take CENVAT credit in terms of the CENVAT Credit Rules, 2004, for the amount which is being claimed as refund.
1.4 The services which are claimed to be exported, qualify to be treated as exports in terms of the rules in force at the time of the said export.
Signature of the statutory auditor/chartered accountant/
authorized signatory of the statutory auditor/chartered accountant
The Deputy/Assistant Commissioner of Central Excise/Service Tax
M/s ________________ , STC No. _______________ hereby undertake that for any amount provisionally paid to me for the refund claim for Rs._____________ for the quarter __________, filed on ___________, in case there is a difference between the amount provisionally paid to me and the amount found to be admissible, I shall pay the said differential amount upon intimation about its inadmissibility, along with applicable interest thereon.
Signature of the claimant
Subject: Provisional payment of amount claimed as refund
Please refer to your refund claim filed for the quarter_______________for an amount of Rs._________filed on _________.
2. On the basis of the certificate date________ issued by the statutory auditor M/s_________________Chartered Accountant M/s_______________ ————– dated_____________, received in this office on__________provisional payment of the amount of Rs ______________ is hereby made vide cheque No._____________dated____________on ___________ Bank,__________,
3. This provisional payment of 80% of the refund amount is purely provisional and without prejudice to the right of the office of the Commissioner of Central Excise/Service Tax, _____________to check the correctness of the claim in terms of the relevant notification and recover the difference, if any, between‑
3.1 the amount provisionally paid and the amount held to be admissible; and
3.2 any amount which appears to have been erroneously refunded.
Signature of Deputy/Assistant Commissioner of Central Excise/Service Tax
MIS Report – Speedy disbursal of pending refund claims of exporters of services under rule 5 of the CENVAT Credit Rules, 2004
Zone: Month: (Amount in lakhs)
pending as on
|Claims for which documents|
(as required in Para 3 of the
Circular) have been submitted
|Amount of Provisional payment made (Para 4.1 of the circular)|
|Forthe Month||Upto the Month||Forthe Month||Upto the Month||Forthe Month||Upto the Month||Forthe Month||Upto the Month|