2017 (3) TMI 619 - AT - Service Tax

100% EOU - Refund claim - various input services - Rule 5 of CCR, 2004 - N/N. 5/2006 - CE (NT) dated 14.03.2006 - Held that - The Tribunal for different period, in the appellant s own case, has held that credit is eligible on the said services. In respect of Work Contract Services, on perusal of the invoices, it is seen that the said services are received by the appellant for minor works like fixing gypsum partition cladding, fixing of glass windows, fixing of wooden door, tower bolt etc. Therefore, these are minor Civil works received by the appellant for the purpose of renovation/repair and maintenance of the premises of the appellant. Therefore, the said services would not fall within the exclusion portion of the definition of input services - rejection of refund unjustified - appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund claim rejection based on nexus between input and output services.

Analysis:
The appeals were filed against the partial rejection of a refund claim by the Commissioner (Appeals). The appellant, a 100% EOU, sought a refund of unutilized CENVAT credit of service tax paid on input services under Rule 5 of CENVAT Credit Rules, 2004. The refund claim remained partially rejected even after adjudication and the first appeal stage. The rejected input services and the corresponding amounts were detailed in a tabulated format. The appellant's consultant argued that the input services were utilized for providing output services and had a direct nexus. The Tribunal had previously analyzed similar services in the appellant's case and allowed credit. The AR, however, contended that Works Contract Services were ineligible for credit as they fell under the exclusion part of the definition of input services.

The Tribunal, after hearing both sides, reviewed the services listed in the table and the previous Final Orders related to the appellant's case. It was noted that the Tribunal had previously held that credit was eligible on the services in question. Regarding Works Contract Services, the Tribunal observed that the services were for minor civil works like partition cladding and window installations, essential for renovation and maintenance of the appellant's premises. Consequently, the Tribunal concluded that these services did not fall within the exclusion part of the input services definition. Citing the precedents set by the Tribunal in the earlier Final Orders, the Tribunal deemed the rejection of the refund claim unjustified and set aside the impugned order. The appeals were allowed, granting consequential reliefs as necessary.

In conclusion, the Tribunal overturned the rejection of the refund claim, emphasizing the nexus between the input and output services and aligning with its previous judgments in the appellant's case. The decision highlighted the importance of analyzing the specific nature of services received and their direct relevance to the appellant's business operations.