Supreme Court of India Commissioner Of Service Tax Iii Mumbai vs M/S Vodafone India Ltd on 6 May, 2025 2025 INSC 914 NONREPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NOS.1081510819/2014 COMMISSIONER OF SERVICE TAXIII, MUMBAI APPELLANT VERSUS M/s. VODAFONE INDIA LIMITED RESPONDENT WITH CIVIL APPEAL NO.5252 OF 2015 CIVIL APPEAL NO.5307 OF 2015 CIVIL APPEAL NO.6556 OF 2015 CIVIL APPEAL NOS.24022403 OF 2016 CIVIL APPEAL NOS.571572 OF 2016 CIVIL APPEAL NO.10885 OF 2016 CIVIL APPEAL NO.3692 OF 2017 CIVIL APPEAL NO.1469 OF 2017 CIVIL APPEAL NO.9152 OF 2017 Signature Not Verified Digitally signed by RADHA SHARMA Date: 2025.07.31 13:54:39 IST Reason: Page 1 of 53 CIVIL APPEAL NO. 4009 OF 2018 CIVIL APPEAL NOS. OF 2025 (Arising out of SLP(C) Nos.2541325414 & 25416 of 2018) CIVIL APPEAL NOS.80458046 OF 2018 CIVIL APPEAL NO.9140 OF 2018 CIVIL APPEAL NO.10349 OF 2018 CIVIL APPEAL NO.9745 OF 2018 CIVIL APPEAL NO.10071 OF 2018 CIVIL APPEAL NOS.1183711838 OF 2018 CIVIL APPEAL NO.1440 OF 2019 CIVIL APPEAL NO. OF 2025 (Arising out of SLP(C) No.10281 of 2019) CIVIL APPEAL NO.4959 OF 2019 CIVIL APPEAL NO.7483 OF 2019 CIVIL APPEAL NOS.90089009 OF 2019 CIVIL APPEAL NO. OF 2025 (Arising out of SLP(C) No. of 2025 arising out of Diary No.38417 of 2019) CIVIL APPEAL NO.2634 OF 2020 CIVIL APPEAL NOS.35463549 OF 2020 Page 2 of 53 CIVIL APPEAL NO. OF 2025 (Arising out of SLP(C) No. of 2025 arising out of Diary No.24028 of 2020) CIVIL APPEAL NO.2424/2022 CIVIL APPEAL NO. OF 2025 (Arising out of SLP(C) No.26382 of 2023) CIVIL APPEAL NOS.1246812471 OF 2024 JUDGMENT NAGARATHNA, J. Delay condoned. Leave granted. 1.1 These Civil Appeals have been filed by the Revenue, i.e. the Service Tax Department, being aggrieved by various orders passed by the Customs, Excise and Service Tax Appellate Tribunal (“CESTAT”, for the sake of convenience). 2. The orders passed by CESTAT in all these appeals have been in favour of the respondentsassessees. The CESTAT has held that the services provided by the respondentsassessees have been in Page 3 of 53 fact exported out of India. Consequently, service tax is not payable by the assessees on such services so exported, vide Rule 4 of the Export of Service Rules, 2005 (“Rules”, for the sake of brevity). It has also held that the assessees had rightly availed payment of CENVAT credit on inputs and input services used for providing such services vide Rule 5 of the Rules. 3. The period under consideration in these appeals range from the year 2003 till the year 2014. During this period, there were several amendments made to the law governing the taxability of export of services, which can be discussed at this stage itself. 4. The policy governing taxability of export of service was initiated in the year 1999 and in the year 2003, it was reiterated. Since service tax is a destinationbased consumption tax, services that were exported out of India were not meant to be taxed. The benchmark in the year 1999 was, whether payment was received in convertible foreign exchange. Ultimately, in the year 2010, the benchmark again came to be fixed as receipt of payment in convertible foreign exchange. Page 4 of 53 5. A brief outline of the amendments made from the year 1999 till 2012 are highlighted as under: I. From 1999 to 2003: 5.1 During the period from the year 1999 to 2003, any taxable service for which payment was received in convertible foreign exchange was exempted from payment of service tax. A notification in this regard was issued vide Notification No.6/99S.T., dated 09.04.1999, whereby exemption was made in respect of the taxable services specified in subsection (48) of Section 65 of the Finance Act, 1994. This Notification was howev