2022 (9) TMI 127 - AT - Service Tax

Refund of unutilised credit in relation to CENVAT credit - inclusion of amount of export turnover for the calculation refund claim, for which payment has not been received during the relevant period - July, 2014 to September, 2014 - Rule 5 of Cenvat Credit Rules read with Notification No. 27/2012-CE(NT) - HELD THAT - There is no dispute with regard to export turnover, which is Rs.17,60,67,491/-. Further, there is no dispute with regard to the eligible /net cenvat credit, which is Rs. 2,43,54,808/-. As regards the denominator, it is held that the correct figure is Rs. 22,71,89,438/-. The Adjudicating Authority to recalculate the amount of refund as discussed and directed and allow the balance amount of refund with interest to the appellant within a period of sixty days from the receipt of copy of this order - the appellant is directed to file a calculation sheet as per the order of the Tribunal, before the Adjudicating Authority for perusal. The appeal is allowed.

Summary

Issues Involved:
Calculation of refund claim based on export turnover for services; Correct calculation of total turnover for refund claim.

Analysis:
The primary issue in this appeal revolves around the correct calculation of the refund amount based on the export turnover for services and the total turnover. The appellant, a service provider registered with the Department, filed a refund claim under Rule 5 of Cenvat Credit Rules for the quarter July, 2014 to September, 2014. The dispute arose when the Adjudicating Authority modified the total turnover amount, leading to the rejection in part of the refund claim. The appellant contended that the total turnover was erroneously calculated, resulting in the incorrect rejection of the eligible refund amount.

The appellant argued that the total turnover should be calculated by including the export turnover and the domestic turnover as disclosed in the relevant service tax return. The appellant highlighted that the export turnover already included the payment received for services provided during the relevant period, and therefore, the total turnover should not have been recalculated to a higher figure. The correct formula for refund calculation was presented by the appellant, limiting the refund amount as per the provisions of Notification No. 27/2012-CE(NT).

Upon careful consideration of the contentions from both parties, the Tribunal found no dispute regarding the export turnover and the eligible net cenvat credit. The Tribunal held that the correct denominator for the total turnover was the figure presented by the appellant. Consequently, the Tribunal allowed the appeal and directed the Adjudicating Authority to recalculate the refund amount accordingly, ensuring the balance amount of refund along with interest is provided to the appellant within a specified timeline. The appellant was instructed to submit a calculation sheet for review by the Adjudicating Authority as per the Tribunal's order.

In conclusion, the Tribunal ruled in favor of the appellant, emphasizing the importance of accurate calculation of the total turnover for refund claims based on export turnover for services. The judgment highlights the significance of adhering to the prescribed formula and notifications in determining the eligible refund amounts under the Cenvat Credit Rules.