Procedural Lapses Cannot Defeat Substantive Export Exemptions

The Kolkata Bench of the Customs Excise and Service Tax Appellate Tribunal allowed the appeal filed by S.M. NiryatPrivate Limited and substantially set aside service tax demands raised on transportation services received in relation to export cargo under the reverse charge mechanism. 

The Tribunal held that substantive export-related exemptions under Notification No. 18/2009-ST cannot be denied merely due to procedural delays in filing Forms EXP-1 and EXP-2. The Bench also accepted the assessee’s contention that the Revenue had incorrectly computed transportation charges and ignored taxes already discharged under the Voluntary Compliance Encouragement Scheme (VCES). 

The ruling reiterates the settled principle that procedural infractions cannot override substantive benefits, especially where export linkage and tax compliance are otherwise undisputed.