2024 (11) TMI 55 - AT - Service Tax

Entitlement to cash refund of accumulated CENVAT credit - Nature of services provided by the appellant - appellant is a 100% EOU unit and provided export services which includes typesetting, composition, artwork, proof reading, project management, XML conversions, multimedia services and page designing, proof reading etc., to overseas clients HELD THAT - Department had allowed the refund claims for the earlier period from January 2008 to March 2008 and also for the subsequent period from October 2010 to September 2013 i.e., much after the rejection of the present refund claims i.e., in the year 2019. The department has not raised any issue of the services provided by them while sanctioning the refund claims for the period October 2010 to September 2013. We find that the principle laid down in the case of mPortal India Wireless Solutions 2011 (9) TMI 450 - KARNATAKA HIGH COURT is subsequently applicable to the facts of the present case, the Appellant being an 100% EOU. Similar observations of the CESTAT Chennai Bench in the case of Suthernland Global Services Pvt. Ltd 2018 (3) TMI 771 - CESTAT CHENNAI has upheld by the Hon ble Madras High Court 2021 (3) TMI 238 - MADRAS HIGH COURT Documentary evidence to support their claim - Chartered Accountant submits that necessary Foreign Inward Remittance Certificate (FIRC) has been submitted before the adjudicating authority and it was not considered solely on the ground that the relevant export invoices have not been reflected in the said FIRC. Responding to the said observation, the learned Chartered Accountant submitted that in the FIRC, the amount is not shown against a particular invoices, therefore, the export invoice numbers are not reflected in the said certificate. Further to correlate, they have submitted one certificate dated 16.04.2009 indicating the number of invoices involved for each FIRC and the said foreign currency that has been received. Therefore, the export of goods against foreign remittances has been established by the appellant.

Summary

Issues:
1. Whether additional grounds can be introduced in appeals.
2. Entitlement to cash refund of accumulated CENVAT credit.
3. Nature of services provided by the appellant.
4. Rejection of refund claims by lower authorities.
5. Applicability of relevant case laws.
6. Documentary evidence to support refund claim.

Analysis:
1. The judgment deals with three miscellaneous applications seeking to introduce additional grounds in appeals. The Chartered Accountants for the appellant argued that these grounds pertain to questions of law not covered earlier and should be allowed. The Revenue had no objection. The Tribunal allowed the applications, making the new grounds part of the appeals.

2. The appeals were filed against Order-in-Appeal No.65 to 67/2014-ST rejecting refund claims of accumulated CENVAT credit for various quarters. The appellant, a 100% EOU, provided services and claimed refunds under Rule 5 of CCR, 2004. The lower authorities rejected the claims based on the nature of services provided by the appellant.

3. The appellant contended that the services offered were Business Support Services, not Business Auxiliary Services as claimed by mistake. They argued that even if the services were exempted, the refund claims should not be denied. The appellant cited precedents supporting their position, emphasizing the distinction between the types of services provided.

4. The lower authorities rejected the refund claims on the grounds that the services provided fell under Business Auxiliary Services, exempted under a specific notification. The Tribunal found that the rejection was not based on the grounds proposed in the show-cause notice, rendering the rejection legally flawed.

5. The judgment referenced relevant case laws, including decisions by the Karnataka High Court and other high courts, supporting the appellant's entitlement to the refund of accumulated CENVAT credit. The Tribunal applied these precedents to the present case, emphasizing the appellant's status as a 100% EOU.

6. The appellant provided documentary evidence, including Foreign Inward Remittance Certificates, to support their refund claims. Despite initial objections regarding the absence of specific invoice numbers, the appellant submitted additional certificates linking remittances to export invoices, establishing the export of goods against foreign remittances.

In conclusion, the Tribunal set aside the impugned order, allowing the appeals with any consequential relief as per law.