2017 (12) TMI 1489 - AT - Central Excise

100% EOU - Refund of unutilized CENVAT credit - various input services - Held that - various judgments of the Tribunal have categorically held that the definition of input service as contained in Rule 2(I) has to be given wider interpretation so as to include all services which are received in or in relation to the business of the assessee - reliance placed in appellant own case 2017 (1) TMI 1506 - CESTAT BANGALORE - refund allowed. Refund of ₹ 2,811/-, which was denied on account of the fact that the same pertains to Bangalore office - Held that - the rejection is wrong because the Bangalore office is working in connection with the business of the company and similarly, the appellant is eligible for the refund of ₹ 353/-, which was rejected towards bank charges/commission and postage for which the appellant has also produced the invoice. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund claim rejection under CENVAT Credit Rules, 2004.

Analysis:
The appeal was filed against the rejection of a refund claim for an amount of ?3,14,742/- under the CENVAT Credit Rules, 2004. The appellant, a 100% EOU, sought a refund of unutilized CENVAT credit of service tax paid on certain services. The adjudicating authority sanctioned ?13,06,922/- but rejected ?3,14,742/-. The appellant contended that the impugned order misconstrued the definition of input service and argued that the services for which refund was denied were essential for the business. The appellant highlighted that similar services were allowed in previous cases. The Commissioner(Appeals) rejected the refund on the grounds that the services were administrative and lacked a connection to the manufacturing activity. However, the Tribunal held that the definition of input service should be interpreted broadly to include all services related to the business. Relying on previous judgments and the appellant's own case, the Tribunal allowed the refund of ?3,11,578/- and set aside the rejection of ?2,811/- and ?353/- related to Bangalore office charges and bank charges/commission/postage, respectively. The impugned order was set aside, and the appeal was allowed with consequential relief.

In conclusion, the Tribunal's decision emphasized the importance of interpreting the definition of input service broadly to encompass all services related to the business. The Tribunal considered previous judgments and the appellant's specific circumstances to allow the refund claim. The rejection of the refund on certain services was overturned, highlighting the necessity of a nexus between the services and the business activities. The Tribunal's ruling provided relief to the appellant by granting the refund and correcting the erroneous rejections made by the Commissioner(Appeals).