2016 (6) TMI 200 - AT - Service Tax

Period of limitation - Refund of Cenvat credit availed - input services received and consumed for export of output services - appellant received the FIRCs on 7th October 2009, 11th and 12th December 2009 and 3rd February 2010 in respect of the exports of the services effected during the material period - Held that - in view of the ratio laid down by the Tribunal in the case of Bechtel India Pvt. Ltd. v. Commissioner of Central Excise, Delhi 2013 (7) TMI 490 - CESTAT NEW DELHI , the refund claim filed in time and cannot be held as time barred. Therefore, the impugned order is unsustainable and liable to be set aside. - Decided in favour of appellant with consequential relief

Summary

Issues:
Refund of credit availed on input services for export of output services.

Analysis:
The appeal was directed against an Order-in-Appeal passed by the Commissioner of Central Excise (Appeals), Pune III. The appellant had filed a refund claim for the credit availed on input services used for exporting output services. The appellant contended that they received the Foreign Inward Remittance Certificates (FIRCs) in time as per the law settled by the Tribunal in a previous case. The first appellate authority upheld the decision of the adjudicating authority, leading to the appeal.

Upon hearing both sides and examining the records, it was found that the issue revolved around the refund of credit availed on input services utilized for exporting output services. It was undisputed that the appellant was eligible to claim cenvat credit on the input services for which service tax had been paid. The appellant received FIRCs for the exports during the material period. The Tribunal referred to the Bechtel India Pvt. Ltd. case and highlighted the conditions for claiming a refund under Rule 5 of the Cenvat Credit Rules, emphasizing that export of service is complete only upon receiving foreign exchange in India.

The Tribunal reiterated the importance of the relevant date of export of services being the date of receipt of foreign exchange, as per the Export of Service Rules. All refund claims were filed within one year from the date of receipt of foreign exchange, meeting the prescribed limitation under Section 11B of the Act. Consequently, the Tribunal concluded that the impugned order was unsustainable and set it aside, allowing the appeal with any consequential relief.

In conclusion, the judgment focused on the timely filing of refund claims for credit availed on input services used for exporting output services, emphasizing the significance of the date of receipt of foreign exchange in determining the completion of service export for refund purposes.