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2013 (12) TMI 621 - AT - Service TaxDenial of refund claim - Cenvat Credit - Information Technology Software Services & Manpower Recruitment Agency Services - Notification No. 05/2006-CE - eligibility of refund under the Rule 5 of the Cenvat Credit Rule read with Notification No.05/2006-CE - Held that - Insofar as requirement of registration with the department as a condition precedent for claiming Cenvat Credit is Concerned, learned counsel appearing for both parties were unable to point out any provision in the Cenvat Credit Rules which impose such restriction. In the absence of statutory provisions which prescribes that registration is mandatory and that if such a registration is not made the assessee is not entitled to the benefit of refund, the authorities committed a serious error in rejecting the claim for refund on the ground which is not existence in law - registration of the premises is not necessary for claiming the Cenvat Credit - Following decision of mPortal India Wireless Solutions Pvt. Ltd. 2011 (9) TMI 450 - KARNATAKA HIGH COURT - Decided in favour of assessee.
Issues:
Eligibility of refund under Rule 5 of the Cenvat Credit Rule read with Notification No. 05/2006-CE. Issue Analysis - Eligibility of Refund: The appeal in question pertains to M/s. ML Outsourcing Services Pvt. Ltd. seeking a refund of Cenvat Credit amounting to Rs.2,51,666 for the period October to December, 2010. The Original Authority had sanctioned a partial refund of Rs.1,10,590, while rejecting the balance. The central issue revolved around the eligibility of the appellants for the refund under Rule 5 of the Cenvat Credit Rules, in conjunction with Notification No. 05/2006-CE. The denial of the refund claim was primarily based on the grounds that the premises where the input services were received were not registered with the Department. Both the lower authorities had upheld this view, emphasizing the necessity of registration for claiming any refund related to unutilized credit. The presiding judge referred to a significant judgment by the Hon'ble High Court of Karnataka in the case of mPortal India Wireless Solutions Pvt. Ltd. The High Court ruling highlighted that there is no statutory provision within the Cenvat Credit Rules imposing a mandatory registration requirement with the Department as a condition precedent for claiming Cenvat Credit. The absence of such a provision renders any denial of refund on the grounds of lacking registration as a serious error. The High Court's decision emphasized that the registration of premises is not a prerequisite for claiming Cenvat Credit, thereby nullifying the basis on which the refund claim was rejected in this case. Consequently, in light of the authoritative judgment from the Hon'ble High Court of Karnataka, the presiding judge, Sahab Singh, set aside the Order-in-Appeal that had rejected the appellants' claim for refund. Following the precedent established by the High Court, the appeal was allowed, thereby granting the appellants the relief sought in their refund claim related to Cenvat Credit. The decision underscores the importance of legal clarity and adherence to statutory provisions in matters concerning the eligibility of refunds under the Cenvat Credit Rules.
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