2017 (12) TMI 713 - AT - Service Tax

Refund of unutilized CENVAT credit - N/N. 5/2006 CE (NT) dated 14.3.2006 - various input services - denial on account of nexus - Held that - the appellant is entitled to CENVAT credit of ₹ 21,31,710/- for which he has produced the invoices on record - also the appellant is entitled to the CENVAT credit of ₹ 2,75,224/- with regard to various input services by holding that the same fall in the definition of input services under Rule 2(l) of CCR - the appeal of the appellant is partially allowed to the extent of ₹ 24,06,934/- out of ₹ 24,90,499/-.

Summary

Issues:
- Rejection of refund claims of unutilized CENVAT credit
- Non-submission of certain invoices
- Nexus of input services with output services

Analysis:
- The appellant, a 100% EOU registered under Software Technology Park Scheme, filed refund claims of unutilized CENVAT credit for exported services. The Asst. Commissioner rejected the claims, leading to an appeal before the Commissioner (Appeals) who remitted the matters. Subsequently, the appellant filed refund claims, and the Deputy Commissioner sanctioned part of the refund but rejected a portion. The appellant appealed the rejection primarily due to non-submission of invoices and nexus of input services with output services.

- The learned consultant argued that the impugned order lacked proper consideration of facts and law. He contended that the appellant had submitted invoices proving payment of service tax. Despite the rejection for non-submission of invoices, the consultant presented invoices totaling to a significant amount, arguing that e-payment challan should suffice. The consultant also highlighted that the issue of wrong classification was not raised initially, and the company's right to appeal was not forfeited. The consultant further defended the nexus of input services with output services by citing relevant case laws.

- The learned AR supported the findings of the impugned order, leading to a detailed analysis by the tribunal. After considering submissions and judgments, the tribunal held that the appellant was entitled to CENVAT credit for the submitted invoices and various input services falling under the definition of Rule 2(l) of CENVAT Credit Rules. Consequently, the appeal was partially allowed, granting the appellant a portion of the claimed refund.

- In conclusion, the tribunal partially allowed the appeal, granting the appellant CENVAT credit for the submitted invoices and certain input services. The operative portion of the order was pronounced in open court on 26/10/2017.