2015 (10) TMI 2362 - AT - Service Tax

Refund of CENVAT Credit - Manpower Recruitment Agency Service, Management Consultancy Service and Security Agency Service - Whether appellant is eligible for refund of CENVAT credit under Rule 5 of CENVAT Credit Rules, 2004 read with Notification No. 5/2006-N.T? Held That - Services provided are either covered by inclusive part of definition of input service or are necessary to provide output service Appellant eligible to take credit. Rent-a-Cab and Outdoor Catering Services - Whether appellant has recovered any amount towards these services from employees or not? - Held That - Original authority is required to verify the matter and quantify amount admissible Matters remanded back.

Summary

Issues:
1. Eligibility for refund of Cenvat credit under Rule 5 of Cenvat Credit Rules, 2004 read with Notification No. 5/2006-N.T., dated 14-3-2006.
2. Refund admissibility for various services like Manpower Recruitment Agency Service, Security Agency Services, Rent-a-Cab, Outdoor Catering services, and Management Consultancy Service.
3. Rejection of claims based on Export of Service Rules and nexus.

Analysis:
1. The main issue in this case is the eligibility of the appellant for a refund of Cenvat credit under Rule 5 of Cenvat Credit Rules, 2004. The Commissioner (Appeals) held that the refund would be admissible only to the extent of the amount actually paid by the appellant's company and not recovered from the employees for certain services. The original authority had rejected the claim based on nexus, while the Commissioner (Appeals) rejected one claim for not following Export of Service Rules.

2. The Tribunal examined the nexus of various services like 'manpower recruitment agency service', 'management consultancy service', and 'security agency service' with the output services provided, namely Call Centre Service. The Tribunal considered the utilization of these services crucial for the smooth functioning of the export service, as explained in the written submissions. It was held that these services are either covered by the inclusive part of the definition of input service or are necessary to provide the output service. However, for services like 'rent-a-cab' and 'outdoor catering services', the Commissioner's order requiring verification if any amount was recovered from employees needs to be upheld, and the original authority is directed to quantify the admissible amount.

3. The Tribunal found that the Commissioner did not provide a satisfactory explanation for concluding that Export of Service Rules were not followed. The Tribunal agreed with the appellant's contention regarding the eligibility for refund of Cenvat credit for specific services and remanded the matters to the original authority for a decision based on the observations made, ensuring a reasonable opportunity for the appellant to present their case.

In conclusion, the Tribunal set aside the impugned order and remanded the case to the original authority for a fresh decision on the eligibility of refund based on the observations and explanations provided, emphasizing the importance of verifying the recovery of amounts for certain services from employees.