2015 (11) TMI 618 - AT - Service Tax

Denial of refund claim - CENVAT Credit - Nexus with output services - Held that - Appellants have been denied an opportunity to submit documents and establish their contentions. It is stated that it is not necessary to verify the documents as the invoices do not have any nexus with the export of services. The appellate authority who is also a fact finding authority is duty bound to look into the documents and contentions of the appellants. Without verification of any records the appellate authority has proceeded in a mechanical fashion to uphold the order of rejection of refund claim. - it is a fit case for remand to the Commissioner (Appeals) for denovo adjudication of the appeal. - matter remanded back - Decided in favour of assessee.

Summary

Issues:
Appeal against denial of refund of unutilized Cenvat credit.

Analysis:
The appellant filed refund claims under Rule 5 of the Cenvat Credit Rules, 2004 for various services for specific periods. A part of the refund claim was denied by the adjudicating authority, which was upheld by the Commissioner (Appeals) stating that the services claimed for refund had no nexus with the exported output service. The appellant argued that they were not given a fair chance to present their case and provide necessary documents. The Commissioner (Appeals) rejected the refund claim without proper verification of the invoices and documents submitted by the appellant.

The Commissioner (Appeals) mentioned that the documents/invoices submitted by the appellant did not have any connection with the export of services, thus denying the refund claim. The appellant contended that they were not given a proper opportunity to submit relevant documents and establish their case. The appellate authority failed to conduct a thorough examination of the records and contentions presented by the appellant, leading to a mechanical affirmation of the rejection of the refund claim. The appellant's consultant argued for a remand to the Commissioner (Appeals) for a fresh adjudication of the appeal, emphasizing the need for a fair opportunity to present documents and arguments.

The tribunal, after reviewing the records and submissions, decided that a remand to the Commissioner (Appeals) was appropriate for a denovo adjudication of the appeal. The Commissioner (Appeals) was directed to provide the appellant with adequate opportunities for a personal hearing and submission of necessary documents. It was emphasized that if the appellant submits the required invoices/documents, the Commissioner (Appeals) must consider them in accordance with the law, ensuring a fair and thorough review of the refund claim.