2019 (11) TMI 1264 - AT - Service Tax

Refund of CENVAT credit - input services used for export of the goods - refund rejected on the ground that the Cenvat credit should be reversed while filing Service Tax return - Rule 5 of Cenvat Credit Rules, 2004 read with N/N. 27/2012-ST dt.18.6.2012 - HELD THAT - In similar set of facts in the case of M/S. GLOBAL ANALYTICS INDIA PVT. LTD. VERSUS THE COMMISSIONER OF G.S.T. CENTRAL EXCISE 2019 (7) TMI 1185 - CESTAT CHENNAI , the CESTAT bench of this Tribunal has allowed the refund claim. The refund claim cannot be denied to the appellant - Appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund claim rejection under Rule 5 of Cenvat Credit Rules, 2004 read with Notification No.27/2012-ST dt.18.6.2012.

Analysis:
The appellant filed a refund claim under Rule 5 of Cenvat Credit Rules, 2004, along with Notification No.27/2012-ST dt.18.6.2012, for availing input services for the export of goods. The department alleged that the appellant did not reverse the Cenvat credit availed on the services in question, leading to a deficiency memo. Both lower authorities rejected the refund claim on the basis that the Cenvat credit should have been reversed while filing the Service Tax return. However, the appellant later reversed the Cenvat credit in the GSTR-3B return. The appellant argued for the refund claim based on a similar case precedent where the CESTAT bench allowed the refund claim. The appellant's counsel contended that the denial of the refund claim was unjustified.

Upon reviewing the case of Global Analytics India Pvt.Ltd., where a similar issue was addressed, the Tribunal observed that the appellant had voluntarily reversed the entire credit carried forward in TRAN-1 in the GSTR-3B return for April 2018. The Tribunal noted that there was no provision in the system to debit the value of the refund, and the post-GST scenario differed from the pre-GST regime. The Tribunal also considered a circular by the Board and other similar orders, concluding that the denial of the refund was not in accordance with the law. Therefore, the Tribunal set aside the impugned orders and allowed the appeal, following the precedent decision in the case of Global Analytics India Pvt.Ltd. The Tribunal held that the refund claim could not be denied to the appellant, and the impugned order was overturned, granting consequential relief, if any.