2017 (4) TMI 1084 - AT - Service Tax

STPI unit - Rebate claim - N/N. 12/2005-ST - Service Tax paid on input services utilized in the activity of export of services - rejection on the ground of time bar - Held that - two conditions have been prescribed for satisfaction of Export of Service. First, being remittance for service of India and its receipts by receiver of services abroad and secondly, remittance must have been received in convertible foreign exchange in India - learned Commissioner erred in computing the period of limitation from the date of payment of the input tax. CENVAT credit - denial on the ground that when services were received some of the premises of the appellant s company were not registered with the Service Tax Department - Held that - taking notice of the fact that all such unlisted premises had subsequently been registered and recognized for the appellant, and also relying on the ruling of Hon ble Karnataka High Court in the case of mPortal India Private Ltd 2011 (9) TMI 450 - KARNATAKA HIGH COURT , where it was held that Registration not compulsory for refund - credit allowed. Rebate claim - Rent-a-cab Operator Service - Held that - transport expenses (Rent-a-Cab operator service) for holding a conference or training session at any place outside the office premises is allowable and accordingly rebate of the same is also allowable. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Disallowance of claim under Notification No.12/2005-ST for Service Tax paid on input services utilized in the export of services.

Detailed Analysis:

1. Issue of Disallowance in Part of the Claim Under Notification No.12/2005-ST:
The appeal was filed against the Order-in-Appeal rejecting the refund facility on grounds of being time-barred. The appellant, a STPI unit exporting services, claimed refund under Notification No.12/2005-ST for Service Tax paid on input services used in exporting services. The Commissioner (Appeals) rejected the refund based on time limitations. The appellant argued that the relevant date for determining eligibility for refund should be the date of payment of duty or tax, not the date of export. The tribunal found the Commissioner's observation conflicted with the conditions of export as defined in Export of Service Rules, 2005. The tribunal ruled in favor of the appellant, stating that the date of payment of input tax should not be the basis for calculating the limitation period.

2. Issue of Unregistered Premises and Cenvat Credit:
Another ground of disallowance was the use of unregistered premises during the receipt of services. The appellant demonstrated that these additional premises were later registered and included in the centralised certificate. Citing a Karnataka High Court ruling, the appellant argued that registration is not a precondition for the refund of input services used for export. The tribunal, considering the subsequent registration of the premises and the cited legal precedent, allowed this ground in favor of the appellant.

3. Issue of Denial of Input Credit for Rent-a-Cab Operator Service:
The third issue pertained to the denial of input credit for Rent-a-Cab Operator Service. The appellant argued that transport expenses for holding business conferences or training sessions outside the office premises should be considered eligible input services for rebate. The tribunal, after considering the arguments, held that such transport expenses for business activities outside the office premises are allowable as input services for rebate.

In conclusion, the tribunal set aside the impugned order and ruled in favor of the appellant on all three grounds. The appellant was entitled to the refund of the balance amount not granted previously, with directions for the adjudicating authority to process the refund within 45 days from the date of the tribunal's order, along with applicable interest.