2015 (9) TMI 315 - AT - Service Tax

Export of services - claim of rebate - Notification No. 11/2005, dated 19-4-2005 issued under Rule 5 of the Export of Services Rules, 2005 - A contention of Revenue is that the element of service tax which is mandatorily required to be mentioned under Rule 4 of the Service Tax Rules is not shown in the export invoices. - Held that - omitting to mention amount of service tax on the invoices when there is documentary evidence showing payment of service tax in the books of accounts maintained by the appellant, cannot debar them from the claim of rebate under Notification No. 11/2005. Revenue authorities should have co-related the huge volume of documents submitted by the appellant, no matter how voluminous, before arriving at a judicious decision. In view of the documents placed on record and. their co-relation, we hold that the rebate is admissible to the appellants on merits. Details of services exported are not mentioned in the Softex Forms. - Held that - since the service mentioned in the Softex Forms is the same as that mentioned in the invoices which have been shown to co-relate with the specific services falling under Section 65(105) in the documents submitted by the appellant to us as well as to the Revenue authority the contention is not correct. Admissibility of Cenvat credit on the input services - Held that - There are two parts to this objection; the first is whether Cenvat credit would be available to these units in respect of input services received by them. We find no provision in law which debars this. The second part of the argument is the taxability of service exported from the SEZ units. Here also there is nothing in the statute which says that the tax should not be paid on taxable service exported from the SEZ units. We reject this contention also. The rebate claim relates to the years 2008-2009 and 2009-2010. Already six years have passed. We have held that rebate is admissible merits. At the same time, this Tribunal cannot go into the verification of the quantum of refund. Refund allowed - matter remanded back for limited purpose of verification of the quantum of rebate to be sanctioned to the appellant - Decided in favor of assessee.

Issues Involved:
1. Rejection of rebate claims under Notification No. 11/2005.
2. Non-compliance with Rule 4A of Service Tax Rules, 1994.
3. Lack of documentary evidence for the export of services.
4. Certification issues with SOFTEX forms.
5. Incorrect certificates attached to SOFTEX forms.
6. Non-specific description of services in documents.
7. Misclassification of services under Section 65 of the Finance Act, 1994.
8. Utilization of Cenvat credit.
9. Admissibility of input services for Cenvat credit.
10. Taxability of services exported from SEZ units.
11. Delay in processing rebate claims.

Detailed Analysis:

1. Rejection of Rebate Claims:
The appellant, M/s. Tata Consultancy Services Ltd., filed appeals against the rejection of rebate claims under Notification No. 11/2005 issued under Rule 5 of the Export of Services Rules, 2005. The Commissioner (Appeals) upheld the orders of the adjudicating authorities, rejecting the rebate claims for services exported to M/s. Tata America International Corporation.

2. Non-compliance with Rule 4A:
The adjudicating authority rejected the rebate claims on the grounds that the invoices did not contain the mandatory details as per Rule 4A of the Service Tax Rules, 1994, such as the description of services exported and the service tax element. The appellant contended that the rebate notification does not refer to the invoices issued under Rule 4A and provided sufficient evidence to establish the export of services and payment of service tax.

3. Lack of Documentary Evidence:
The adjudicating authority found that the appellant failed to provide documents to show that services were exported under the submitted invoices and that service tax was paid. The appellant provided various documents, including invoices, SOFTEX forms, Foreign Inward Remittance Certificates (FIRC), and sales registers, to establish the export of services and payment of service tax.

4. Certification Issues with SOFTEX Forms:
The Commissioner (Appeals) upheld the rejection of rebate claims, stating that the SOFTEX forms did not reflect the details of services exported and were not certified by the STPI authorities. The appellant argued that the SOFTEX forms were certified and correlated with the invoices and FIRCs.

5. Incorrect Certificates Attached to SOFTEX Forms:
The adjudicating authority noted that in many cases, incorrect certificates were attached to the SOFTEX forms. The appellant provided evidence showing that the SOFTEX forms were certified by the STPI authorities and correlated with the invoices and FIRCs.

6. Non-specific Description of Services in Documents:
The adjudicating authority rejected the rebate claims, stating that there was no specific description of the services in the documents, making it impossible to ascertain the category of services against which the rebate was claimed. The appellant provided detailed documents correlating the invoices with the specific services classified under Section 65(105) of the Finance Act, 1994.

7. Misclassification of Services:
The adjudicating authority contended that the description given on the invoices did not match any of the categories of services under Section 65(105) of the Finance Act, 1994. The appellant argued that they had provided sufficient evidence to establish the classification of services and that the onus was on the department to prove otherwise.

8. Utilization of Cenvat Credit:
The adjudicating authority questioned the correctness of the Cenvat credit utilized for payment of service tax on the exported services. The appellant provided documents establishing that the Cenvat credit was correctly availed and utilized for payment of service tax on the exported services.

9. Admissibility of Input Services for Cenvat Credit:
The adjudicating authority raised objections regarding the admissibility of certain input services, such as catering, for Cenvat credit. The appellant argued that these services were related to their business and were admissible as input services under the Cenvat Credit Rules.

10. Taxability of Services Exported from SEZ Units:
The adjudicating authority contended that service tax was not leviable on services exported from SEZ units and questioned the availability of Cenvat credit for these units. The appellant argued that there was no provision in law debarring the availability of Cenvat credit for SEZ units and that service tax could be paid on taxable services exported from SEZ units.

11. Delay in Processing Rebate Claims:
The Tribunal noted that the rebate claims related to the years 2008-2009 and 2009-2010, and six years had already passed. The Tribunal directed the adjudicating authority to verify the quantum of rebate and pass an order within three months, emphasizing the need for a timely decision.

Conclusion:
The Tribunal allowed the appeal, holding that the rebate claims were admissible on merits. The case was remanded back to the adjudicating authority for verification of the quantum of rebate to be sanctioned to the appellant, with a directive to pass an order within three months. The Tribunal also highlighted the need for consistency in decisions across different jurisdictions and directed a copy of the order to be forwarded to the Chairman of CBEC.

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