2019 (5) TMI 598 - AT - Service Tax

Refund of unutilised CENVAT credit - export of Information Technology Software Services - rejection on the ground that FIRCs received from bank, do not show the invoice detail on the remittance certificate issued by the bank - HELD THAT - Apparently the adjudicating authority had made his observation that FIRCs received from bank had no co-relationship with export invoice may be due to such arrear payment pertaining to previous financial year made after March, 2015. Be that as it may, since the appellate authority himself tallied the same and found no error in the re-conciliation statement of the appellant, rejection of refund claim on the ground that FIRCs statement submitted by the bank did not contained invoice no. is contrary to the procedural requirement in view of clarificatory Circular dated 12.03.2009. Refund allowed - appeal allowed - decided in favor of appellant.

Summary

Issues:
Rejection of refund claim against unutilised CENVAT credit due to lack of invoice details on FIRCs received from the bank.

Analysis:
The appellant, an exporter of 'Information Technology Software Services,' filed refund claims for two quarters, which were rejected by the first adjudicating authority and confirmed by the Principal Additional Director General (PADG) on the ground that FIRCs did not bear invoice numbers. The rejection was based on the belief that the appellant's claim of FIRCs not showing export invoice details as per bank policy was unacceptable. The rejection order was challenged before the Appellate Tribunal.

During the appeal, the appellant's counsel cited a circular stating that linkage between export invoice and remittance is not required when FIRCs are issued on a consolidated basis. They argued that self-certification of FIRCs should suffice, and there is no need for a banker's certificate. Refund should be allowed based on certified statements of the claimant, supported by a reconciliation statement showing export invoice details. The appellant sought a refund with applicable interest.

The respondent-department's representative supported the rejection, stating that no evidence was presented to establish the bank's policy of not providing invoice details against FIRCs. They argued that the PADG's order did not require interference.

After a thorough review of the case record and the appellant's bank letter, the Tribunal found that the rejection based on the lack of invoice details on FIRCs was contrary to procedural requirements. The bank's self-certified statements, along with a reconciliation statement, should suffice for processing the refund. Referring to a precedent set by the CESTAT, Bangalore Bench, the Tribunal allowed the appeal, setting aside the PADG's order and directing the respondent-department to refund the amount with applicable interest within three months.

This detailed analysis highlights the key legal issues, arguments presented by both parties, relevant precedents, and the Tribunal's decision, providing a comprehensive understanding of the judgment.