2018 (6) TMI 1201 - AT - Service Tax

Refund claim - rejection on the ground that the export turnover during the claim period was nil - Held that - There is an export of service in the present case - the original authority has rejected the refund only on the ground that the export turnover has not been shown in the ST-3 return and that there was clubbing of quarters for claiming the refund - both these grounds on which the original authority has rejected the refund is not sustainable in law - appeal dismissed - decided against Revenue.

Summary

Issues:
Appeal against setting aside Order-in-Original and allowing the appeal of the assessee regarding refund claim for unutilized CENVAT credit on service tax paid on certain services.

Analysis:
The appeal was filed by the Revenue against the impugned order dated 30.8.2017 passed by the Commissioner (A), setting aside the Order-in-Original and allowing the appeal of the assessee. The assessee provided Management Consultancy Service to a foreign client and availed CENVAT credit on service tax paid on those services. A refund claim was filed for unutilized credit during April 2015 to December 2015. The original authority rejected the refund claim stating that export turnover during the claim period was nil. The Commissioner (A) observed that export proceeds were realized in the last quarter of the claim period and that there was no provision against clubbing quarters for refund claims. The Revenue contended that the Commissioner (A) did not consider the nexus between input and output services and should have verified the same. The assessee argued that all conditions for considering services as export of service were met, providing documentary proof for export during the relevant quarter.

After hearing both parties and examining the records, the Tribunal found that the original authority concluded there was an export of service and rejected the refund claim based on non-inclusion of export turnover in ST-3 returns and clubbing quarters for refund. The Tribunal upheld the Commissioner (A)'s decision, stating that the grounds for rejection were not legally sustainable. The Tribunal dismissed the Revenue's appeal, affirming the Commissioner (A)'s order. The decision was pronounced on 03/05/2018.