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2017 (1) TMI 144 - AT - Central Excise100% EOU - Rejection of refund claim - Rule 5 of CCR, 2004 - consultancy service - financial service - photocopy machine service - testing service - Held that - reliance placed in the decision of the case of Coca Cola India Pvt. Ltd. vs. CCE, Pune-III 2009 (8) TMI 50 - BOMBAY HIGH COURT , where the issue is covered in favor of the appellant and all the input services on which the CENVAT credit has been denied relates to the business of the appellant and therefore, I allow the appeal - refund allowed - appeal allowed - decided in favor of appellant.
Issues:
Refund of unutilised service tax credit under Rule 5 of CENVAT Credit Rules, 2004 for various input services. Analysis: The appeal was filed against the order passed by the Commissioner (A) partially allowing the refund claim of the appellant related to unutilised service tax credit. The appellant, a 100% EOU engaged in manufacturing and exporting garments, sought a refund of &8377; 3,56,834/- for CENVAT credit availed on input services from January 2011 to March 2011. The original authority granted a refund of &8377; 2,44,640/- but rejected &8377; 1,12,194/- citing that certain input services like consultancy, financial services, photocopy machine service, and testing services were not linked to manufacturing activities. The appellant appealed, and the Commissioner (A) allowed the refund for some activities but denied credit for consultancy, financial services, photocopy machine service, and testing services totaling &8377; 37,356/-. The appellant then approached the Tribunal challenging this decision. The appellant, through written submissions, argued that all the denied services fell within the definition of 'input service' as per the CENVAT Credit Rules, 2004. They contended that these services were used directly or indirectly in or in relation to manufacturing activities and clearance of final products, thus eligible for credit. Citing precedents like Coca Cola India Pvt. Ltd. vs. CCE, Pune-III, the appellant emphasized that the services had a direct nexus with their business operations. The appellant's counsel highlighted that the denial of credit was unjustified based on the legal provisions and relevant case laws. On the other hand, the respondent, represented by the learned AR, supported the findings of the impugned order denying credit for certain services. However, after examining the arguments and considering the precedents cited by the appellant, the Tribunal held that all the input services for which credit was denied were indeed related to the appellant's business activities. The Tribunal found merit in the appellant's contentions and decided in their favor, setting aside the impugned order and granting consequential relief, if applicable. The judgment was pronounced on 15/11/2016, allowing the appeal of the appellant regarding the refund of unutilised service tax credit under Rule 5 of the CENVAT Credit Rules, 2004 for various input services.
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