2017 (11) TMI 425 - AT - Service Tax

Refund claim - export of services - Event Management Service - denial on account of nexus - Held that - in the impugned order there is no discussion with regard to Event Management Service and its nexus with the output service and further there is no discussion regarding inconsistency in computation of the amount eligible for refund - Event Management Service in the present case is an input service as is covered by various decisions relied upon by the appellant. For the purpose of removing the inconsistency in the computation, I remand the case back to the original authority to pass a reasoned order after correcting the inconsistency as has been done by the original authority - appeal allowed by way of remand.

Summary

Issues:
Refund of cenvat credit on Event Management Service and inconsistency in computation of amount eligible for refund.

Analysis:
The appeal was against an order disposing of eight appeals related to the refund of cenvat credit on Event Management Service and inconsistency in refund computation. The appellant, engaged in providing IT-enabled BPO services, exported services without service tax payment and filed a refund claim under Cenvat Credit Rules. The Deputy Commissioner partially allowed the refund claim, which was partly upheld by the Commissioner (Appeals). However, the Commissioner's order lacked reasoning on Event Management Service and export turnover ratio application. The appellant contended that the order was not a speaking one, lacked nexus analysis for certain services, and had computation inconsistencies.

The appellant argued that the impugned order failed to consider submissions, deviated from judicial precedents, and lacked reasoning on Event Management Service nexus and refund computation consistency. Citing legal precedents, the appellant highlighted the necessity of providing reasoning for conclusions. The appellant chose not to appeal on certain service amounts but challenged the Event Management Service refund denial due to its direct relation to business development. The appellant presented invoices and referenced tribunal and high court decisions supporting the nexus of Event Management Service with business activities.

After hearing both parties, the Tribunal found the impugned order lacked discussion on Event Management Service nexus and refund computation consistency. Relying on appellant-cited decisions, the Tribunal considered Event Management Service as an 'input service' and remanded the case to the original authority for a reasoned order correction. The Tribunal directed the original authority to issue a fresh order within two months, considering the observations and corrections made for subsequent periods.

In conclusion, the Tribunal remanded the case for a fresh order due to the lack of discussion on Event Management Service nexus and refund computation inconsistencies in the impugned order, emphasizing the need for a reasoned decision in line with legal precedents and correcting inconsistencies observed for subsequent periods.