2018 (8) TMI 172 - AT - Service Tax

Refund of accumulated Cenvat credit - Export of output services - Rule 5 of the CCR read with the relevant N/N. 27/2012-CE(NT) dated 18.6.2012 - denial of refund on the ground that the documentary evidence for export of services has not been satisfactorily submitted - Held that - Identical issue decided in the case of MOBILE IRON INDIA SOFTWARE PVT. LTD, HYDERABAD VERSUS THE COMMISSIONER CCE & ST, HYDERABAD-IV 2017 (4) TMI 228 - CESTAT HYDERABAD , where the grounds for rejection of refund was non-production of Softex returns from STPI authorities. The Tribunal has concluded that the insistence to furnish Softex returns from STP authorities is not as per the law laid down in the relevant field. In the present case also, the appellant has claimed to have exported Information Technology Software Service. The fact of export of such software and the receipt of the foreign exchange therefor is sufficiently evidenced from the invoices, the FIRCs and the Chartered Accountant s certificate certifying the total turnover - rejection of refund not justified. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Challenge to Order-in-Appeal No. 402/2017-18 dated 12.12.2017 regarding the claim for refund of accumulated Cenvat credit for the period April, 2015 to September 2015 based on export of services without submission of Softex Forms.

Analysis:
The appellant, a subsidiary of a US company, provided product development support services under taxable services including 'Information Technology Software Service'. The dispute arose when the claim for refund of accumulated Cenvat credit was rejected due to the absence of Softex Forms, a requirement for offshore export of services through data communication link as per RBI guidelines. The appellant contended that all necessary supporting documents were submitted, and the submission of Softex Forms was not applicable for software export, citing a Tribunal case precedent. The Revenue argued that satisfaction of export and foreign exchange receipt is crucial for refund under Rule 5 of CCR, 2004, and the failure to submit Softex Forms led to rightful rejection of refund claims.

The Tribunal analyzed the case, emphasizing that conditions under Notification No. 27/2012-CE(NT) must be met for refund eligibility, including evidence of service export and foreign exchange receipt. While the lower authorities stressed the necessity of Softex Forms, the Tribunal referred to a previous case where such forms were deemed unnecessary for service export. The Tribunal found that the appellant had provided ample evidence of software service export through invoices, FIRCs, and CA certificate, concluding that the insistence on Softex Forms was not legally mandated. Consequently, the Tribunal ruled in favor of the appellant, allowing the refund under Rule 5 of CCR, 2004, setting aside the impugned order and disposing of the appeal.

In summary, the judgment centered on the requirement of Softex Forms for refund of Cenvat credit based on service export. The Tribunal clarified that such forms were not obligatory for service export, highlighting the sufficiency of other supporting documents to establish the export and foreign exchange receipt. This case underscores the importance of meeting prescribed conditions for refund eligibility and the need for authorities to adhere to legal provisions in assessing refund claims related to service exports.