2017 (7) TMI 348 - AT - Service Tax

CENVAT credit - various input services - Held that - all the services referred are eligible to be availed as CENVAT Credit and since the appellant is exporting the services, is eligible for the refund of the service tax paid on such services - credit allowed - appeal dismissed - decided against Revenue.

Summary

Issues:
Revenue's appeal against denial of refund on various services.

Analysis:
The Revenue appealed against the Order-in-Appeal that set aside the denial of refund on several services, including DG Rent, Telecommunication Services, Manpower Recruitment Agency Services, House Keeping Services, Professional/Management Consultant Services, and Installation, Testing, and Commissioning Services of Bio-metric Attendance System. The First Appellate Authority overturned the Order-in-Original, providing detailed reasoning for each service. The Authority found that the denial of refund on these services was legally unsustainable and set aside with consequential relief.

The First Appellate Authority specifically addressed the issues related to each service. For DG Rent, the Authority established the nexus between the service and the output service, concluding that the denial of credit/refund was not legally sustainable. Similarly, for Mobile Telecom services, the Authority found the nexus established for business purposes, setting aside the denial of refund. Regarding Manpower Recruitment Agency Services, the Authority held that the omission of service description on the invoice was a curable defect and directed that the credit cannot be denied. For House Keeping services, the Authority clarified that under reverse charge mechanism, the proper document for tax payments is the challan, not the invoice, setting aside the denial of credit.

Furthermore, for Professional/Management Consultant services, the Authority emphasized the inclusion of legal and accounting services in the definition under Rule 2(l) of CCR 2004, establishing the nexus with the output service and setting aside the denial of refund. Lastly, for Installation, Testing, and Commissioning services, the Authority confirmed the nexus with the output service, leading to the rejection of denial of credit/refund. The First Appellate Authority's findings were in line with established legal principles and various Tribunal decisions, supporting the eligibility of the appellant for CENVAT Credit and refund of service tax paid on the mentioned services.

In conclusion, the Appellate Tribunal upheld the correctness and legality of the impugned order, finding no infirmity. The appeal by the Revenue was rejected based on the detailed analysis provided by the First Appellate Authority, which aligned with the settled law and decisions of the Tribunal and higher courts. The judgment affirmed the eligibility of the appellant for CENVAT Credit and refund of service tax paid on the services in question, considering the appellant's export of services.