2023 (4) TMI 767 - AT - Service Tax

Refund of unutilized accumulated CENVAT Credit - export of services - Service Tax paid on Event Management Service - Service Tax paid on Renting of Immovable Property - deficiency memo issued but there was no issue of show cause notice for rejection of refund - reason for rejection was that the premises in respect of which the rent was paid was not included in the Service Tax registration by the appellant. HELD THAT - It is now settled law that unless CENVAT Credit availed by the appellant has not been recovered by way of issue of show cause notice invoking Rule 14 of CENVAT Credit Rules, 2004, the CENVAT Credit available on the books of account cannot be rejected when it is accumulated on account of export of Service. In the present case, it is found that above stated amounts of CENVAT Credit was not disallowed by way of invoking Rule 14 of CENVAT Credit Rules, 2004 and therefore, the said amounts are available in the account of the appellant. Since the CENVAT Credit is available on the accounts of the appellant, the refund of the same could not be rejected. The impugned order is set aside to the extent of rejection of refund of CENVAT Credit respectively to the tune of Rs. 5,97,465/- and Rs. 6,17,759/- and the original authority is directed to allow the refund of the same. Appeals allowed.

Summary

Issues:

The issues involved in this case are related to the rejection of refund claims for unutilized accumulated CENVAT Credit under Notification No. 27/2012-CE dated 18.06.2012, concerning Service Tax paid on input services for export of service.

Issue 1: Rejection of Refund Claims

The appellant, engaged in export of service, filed two separate refund applications for unutilized accumulated CENVAT Credit under Notification No. 27/2012-CE. The Commissioner (Appeals) allowed some relief but rejected refund amounts of Rs. 5,97,465/- and Rs. 6,17,759/- for different claims. The rejection was based on the premises for which rent was paid not being included in the Service Tax registration by the appellant.

Judgment 1:

The Tribunal observed that unless CENVAT Credit availed by the appellant is recovered through a show cause notice invoking Rule 14 of CENVAT Credit Rules, the credit cannot be rejected when accumulated due to export of service. As the credit was not disallowed under Rule 14, the amounts were available in the appellant's account. Consequently, the Tribunal set aside the impugned order and directed the original authority to allow the refund of Rs. 5,97,465/- and Rs. 6,17,759/- respectively.

Conclusion:

Both appeals were allowed, and the refund of the accumulated CENVAT Credit was directed to be granted to the appellant.

*(Order dictated and pronounced in open court)*