2020 (1) TMI 424 - AT - Service Tax

Refund of unutilized Cenvat Credit - export of services - Rule 5 of the Cenvat Credit Rules, 2004 read with Notification No.27/2012-CE(NT) dated 18.6.2012 - place of provision of services - HELD THAT - On the identical issue of refund Under Rule 5, various refund claims were filed by the appellant and there was a chequered history of the overall cases - In the present case matter was remanded by the tribunal to the Commissioner (Appeals) for reconsideration. However, the Commissioner (Appeals) also remanded the matter to the Adjudicating Authority. Appeal allowed by way of remand.

Summary

Issues:
Refund claim of unutilized Cenvat Credit on input services used in the export of Information Technology Software service under Rule 5 of the Cenvat Credit Rules, 2004 read with Notification No.27/2012-CE(NT) dated 18.6.2012.

Analysis:
The appellant filed a refund claim for unutilized Cenvat Credit on input services used in exporting IT software service. The adjudicating authority observed that the appellant, being another establishment of the service receiver, had failed to clarify the provision of services to Indian customers. The authority found that the service provision occurred in India for consumption, not aligning with the Export of Service Rules, 2005. Consequently, the refund claims were rejected under Notification No. 27/2012-CE dated 18.6.2012. The Commissioner (Appeals) rejected the appeals, leading the appellant to approach CESTAT. The CESTAT remanded the case back to the Commissioner (Appeals) to decide in line with a previous order favoring the appellant. However, the Commissioner (Appeals) remanded the matter to the Adjudicating Authority, prompting the present appeal by the appellants.

The appellant argued that the issue was already settled by the tribunal in a previous case, and there was no need for further remand. They highlighted that a previous tribunal order favored them, indicating an agreement on the export of services. The revenue, represented by the Assistant Commissioner, reiterated the findings of the impugned order. The tribunal noted a history of refund claims by the appellant on the same issue, with varied outcomes. A previous tribunal order favored the appellant, emphasizing their role as a service provider to customers outside India, qualifying as an export of service. Following this precedent, the tribunal set aside the impugned orders and allowed the appeals, aligning with the decision in the previous case.

The tribunal's decision was based on the appellant's provision of services to customers outside India, qualifying as an export of service. This aligns with the precedent set in a previous case, where a similar situation was analyzed, and the export of service was upheld. The tribunal emphasized that the services provided by the appellant on behalf of their principal outside India constituted an export of service, dismissing the revenue's claims against the refund. The tribunal's decision rested on the understanding that the appellant's services were in line with the Export of Taxable Service Rules, 2005, entitling them to the refund claim.

In conclusion, the tribunal's decision favored the appellant, upholding their claim for a refund of unutilized Cenvat Credit on input services used in exporting IT software service. The decision was based on the appellant's provision of services to customers outside India, qualifying as an export of service, in line with previous legal precedents.