No Levy survives Declaration of Invalidity: Delhi HC directs Refund of Service Tax on CIF of Ocean Freight

The Delhi High Court has directed the refund of service tax on the CIF (Cost, Insurance, and Freight) value of ocean freight after declaring the levy invalid. The court’s decision addresses the issue of whether the service tax on ocean freight should be levied on the CIF value or the Freight On Board (FOB) value. In this case, the court ruled that service tax should not be applicable on the CIF value of ocean freight, as it does not align with the provisions of the Finance Act. As a result, businesses that have paid service tax on the CIF value are entitled to a refund. This judgment has significant implications for businesses involved in international shipping and import-export activities.