2015 (11) TMI 654 - AT - Service Tax

Rebate claim for refund of service tax paid on input services used in export of output services - claim for two units where the centralized registration taken later - export invoice do not contain the details of service provided - Notification No.12/2005-ST dated 19.4.2005 - Business Auxiliary Service/Business Support Service - activity of business process outsourcing - Held that - If the details of service provided are available and classification can be done on that basis and if the services have been exported, that would be sufficient for the purpose of granting rebate. While granting rebate what is required to be seen is whether the output service has been exported or not and whether input services have been used or not. In any case, the service exported is not liable to tax. Therefore as claimed by the appellants, certain omissions in terms of Rule4A of Service Tax Rules could not come in the way of sanction of rebate in respect of input services if the appellant is able to show that there is an output service and the same has been exported. A consolidated ST-3 returns in respect of two registered premises should be acceptable. Nexus between input and output services and correlation of FIRC are required to be considered afresh and this can be done by the original authority. Nexus can be considered in the light of Apotex Research (Interim Order) 2015 (3) TMI 346 - CESTAT BANGALORE , even though the issue as to whether nexus is required to be considered in the case of rebate itself would need a consideration. I consider that it would be proper to remand the issue to the original authority to consider these two aspects afresh after getting necessary details from the appellants. - Appeal disposed of.

Summary

Issues:
1. Time limitation under Section 11B for rebate claim.
2. Requirement of separate claim for two registered premises.
3. Details of services in export invoices.
4. Nexus between input services and services exported.
5. Correlation of input services with FIRC for exports.

Analysis:
1. The appellant, engaged in business process outsourcing, filed a rebate claim for service tax paid on input services used in export of output services. The claim was rejected as time-barred under Section 11B of the Central Excise Act, 1944. However, the appellant relied on a High Court decision stating that omissions in subsequent notifications should not bar rebate claims if other conditions are met. The Tribunal found this reasoning applicable to service tax matters as well, emphasizing the need to consider the purpose of granting rebate.

2. Regarding the requirement of separate claims for two registered premises, the Tribunal referred to a case where it was held that for service providers, the service could be received anywhere, allowing flexibility in CENVAT credit availment. The appellant had originally applied for registration for both premises and had filed consolidated returns, indicating that separate claims were not necessary in this case.

3. The rejection based on export invoices lacking service details was countered by the appellant, arguing that benefits should not be denied for technical lapses. The Tribunal agreed, stating that as long as service details are available for classification and exportation, rebate should not be denied due to technical deficiencies.

4. The issue of nexus between input services and services exported was raised, along with difficulties in correlating input services with FIRC for exports. The Tribunal acknowledged the need to consider these aspects and decided to remand the issue to the original authority for a fresh assessment based on relevant details provided by the appellant.

5. In conclusion, the Tribunal disposed of the appeal by directing a reconsideration of the nexus between input and output services, as well as the correlation of input services with FIRC for exports. The decision highlighted the importance of ensuring that the services exported are not liable to tax and that technical lapses should not hinder the sanction of rebates if the necessary criteria are met.