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2018 (5) TMI 612 - AT - Service TaxRefund of unutilized CENVAT credit - export of service under the category of BAS - Place of Provision of Service Rules - Held that - In view of the various decisions relied upon by the appellant, the services rendered by the appellant under the category of BAS is Export of Service and therefore, the appellants are entitled to refund of CENVAT credit - credit allowed. Refund also denied on account of inconsistency in the computation of amount eligible for refund - Held that - the original authority has not applied the formula in a correct manner on account of which the refund amount has been substantially reduced - for the subsequent period, the original authority has correctly applied the formula to determine the eligibility of refund and those orders are on record produced by the appellant - the original authority will reconsider and apply the correct formula for the purpose of determining the refund claim of the appellant - matter on remand. Refund claim - Event Management Service - Real Estate Agents - Supply of Tangible Goods services - Business Exhibition Service - Convention Services - denial on account of nexus - Held that - Event Management Service falls in the definition of input service‟ as has held by many decisions of the Tribunal and the High Court - reliance paced in the case of Endurance Technologies Pvt. Ltd. vs. CCE 2013 (8) TMI 601 - CESTAT MUMBAI . As far as the Real Estate Agents and Supply of Tangible Goods services are concerned, the learned counsel did not press for these services, being small amount. Business Exhibition Service - Held that - this service falls in the definition of input service‟ as it is integrally connected with the output service - credit allowed. Convention Services - Held that - this is also related with the business of the company and fall in the definition of input service‟ as held in the case of IBM India Pvt. Ltd. vs. CCE 2014 (10) TMI 452 - CESTAT BANGALORE . Refund claim also denied on the ground of procedural non-compliance - Held that - the appellants have submitted the invoices and they have annexed the copies of the invoices along with the appeal papers but the same were not considered by the authorities and the appellant is still ready to produce the invoices if the matter is remanded to the original authority - matter on remand. Refund also rejected on the ground that the invoices were addressed to unregistered premises - Held that - the decision of the Karnataka High Court in mPortal India wireless Solutions P. Ltd. vs. CST, Bangalore 2011 (9) TMI 450 - KARNATAKA HIGH COURT wherein it has been held that registration with the department is not a pre-requisite for claiming the CENVAT credit - refund allowed. Refund of ₹ 30,415/- were rejected on account of apparent error in the Order-in-Original - Held that - this is an apparent error and the appellant is entitled to refund of this amount ₹ 30,415/-. For the purpose of quantification of the refund, the matter is remanded back to the original authority to verify the invoices and other documents and thereafter decide the refund claims - appeal allowed by way of remand.
Issues Involved:
1. Not a speaking order. 2. Order is contrary to allegations made in show-cause notice. 3. Export of service under the category of Business Auxiliary Services (BAS). 4. Inconsistencies in computation of eligible amount of refund. 5. Procedural non-compliances. 6. CENVAT credit availed for unregistered business premises. 7. Input services having nexus with the output. Issue-wise Detailed Analysis: 1. Not a Speaking Order: The appellant contended that the impugned order lacked detailed reasoning and failed to address the factual and legal positions adequately, making it unsustainable in law. 2. Order Contrary to Allegations Made in Show-Cause Notice: The appellant argued that the rejection of refund claims was beyond the scope of the show-cause notice, particularly concerning the export turnover of Business Auxiliary Services (BAS). The show-cause notice did not raise concerns over the non-consideration of services under BAS as export services. 3. Export of Service under the Category of Business Auxiliary Services (BAS): The appellant provided services such as marketing the goods of foreign group companies to potential customers, which they claimed fell under the definition of "Export" under Rule 6A of Service Tax Rules, 1994, read with Rule 3 of the Place of Provision of Service Rules, 2012. The appellant fulfilled all conditions for export without payment of service tax, including the recipient being located outside India, the place of provision of service being outside India, and consideration received in convertible foreign exchange. The appellant cited multiple tribunal decisions supporting their claim that these services qualify as export services. 4. Inconsistencies in Computation of Eligible Amount of Refund: The appellant highlighted an apparent error in the computation of the eligible refund amount by the Deputy Commissioner, who did not follow the prescribed formula under Rule 5 of CENVAT Credit Rules, 2004. The term "Net CENVAT Credit" should be applied correctly, as defined, without deducting credit utilized during the quarter. The appellant provided evidence of correct computations for subsequent periods and requested reconsideration by the original authority. 5. Procedural Non-Compliances: Refunds were denied due to non-submission of certain invoices or incomplete invoices. The appellant contended that they had submitted all necessary invoices and were willing to produce them again if the matter was remanded. They argued that substantive rights should not be denied due to procedural non-compliances. 6. CENVAT Credit Availed for Unregistered Business Premises: Refunds were rejected because invoices were addressed to unregistered premises. The appellant cited a Karnataka High Court decision stating that registration is not a prerequisite for claiming CENVAT credit and provided proof of registration. The tribunal held that the refund was wrongly rejected on this ground. 7. Input Services Having Nexus with the Output: The appellant challenged the rejection of refunds for various input services, including Event Management Service, Business Exhibition Service, and Convention Services, arguing that these services are integrally connected with their output services. They cited multiple tribunal decisions supporting their claims. For Real Estate Agents and Supply of Tangible Goods services, the appellant did not press the issue due to the small amounts involved. Conclusion: The tribunal found merit in the appellant's arguments on several grounds and remanded the matter back to the original authority for re-evaluation. The original authority was directed to verify invoices and other documents and apply the correct formula for determining the refund claims based on the tribunal's findings. Order Pronounced: The order was pronounced in open court on 03.05.2018.
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