2017 (3) TMI 315 - AT - Service Tax

Refund of unutilised CENVAT credit - rejection on the ground that the assessee was not registered with the service tax department at the time of providing / export of Business Auxiliary Services and the registration was taken subsequently on 08.04.2008 - Held that - the issue is squarely covered by judgment of the Hon ble Karnataka High Court in the case of Portal India Wireless Solutions P. Ltd. 2011 (9) TMI 450 - KARNATAKA HIGH COURT , where it was held that Registration not compulsory for refund - appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund of unutilized Cenvat Credit under Notification No.5/2006-CE (N.T.) - Requirement of registration with the service tax department for claiming Cenvat Credit - Interpretation of conditions under Notification 5/2006 - Precedent cases on eligibility of refund under Rule 5 of Cenvat Credit Rules, 2004.

Analysis:
The appellants appealed against the rejection of their refund claims for unutilized Cenvat Credit for three quarters based on Notification No.5/2006-CE (N.T.). The ground for rejection was the lack of registration with the service tax department at the time of providing services. The adjudicating authority did not accept the reliance on a previous case due to differences in notifications. The appellants argued that the department withdrew their appeal in a related case and cited a Karnataka High Court judgment to support their claim that registration was not a prerequisite for claiming Cenvat Credit.

The Revenue argued that registration was a substantive requirement for refund under the notification. After hearing both sides, the Tribunal found the key issue to be the eligibility of refund under Rule 5 of Cenvat Credit Rules, 2004 with respect to Notification No.5/2006-CE(N.T.). The lower authorities had held that registration with the service tax department was necessary for refund claims. However, the Tribunal referenced a Karnataka High Court judgment stating that there was no statutory provision mandating registration as a condition for claiming Cenvat Credit, overturning the lower authorities' decision. The Tribunal also cited previous cases where registration was not deemed mandatory for refund claims.

In light of the Karnataka High Court judgment and previous Tribunal decisions, the Tribunal set aside the Commissioner (Appeals)'s order, allowing the appeals filed by the appellants. The decision emphasized that registration with the service tax department was not a prerequisite for claiming refund of unutilized credit under the specified notification.

This comprehensive analysis highlights the interpretation of the conditions under Notification 5/2006, the legal precedence set by the Karnataka High Court judgment, and the Tribunal's consistent stance on the eligibility of refund claims under Cenvat Credit Rules, 2004.