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TMI Blog2020 (11) TMI 240X X X X Extracts X X X X X X X X Extracts X X X X ..... 454/- on 22.02.2010. Service tax is levied on the service provider of taxable service as per Section 66 of the Finance Act, 1994. However, in respect of some services covered under Section 66A, where the service is imported, the service recipient is liable to pay service tax as if he was the one who provided the service. If the service on which the service recipient paid service tax is their input service, they can take CENVAT credit of the same. CENVAT credit can be used to pay service tax on their output services. It can also be refunded to them if the output service is exported (Rule 5 of Cenvat Credit Rules, 2004). In this case, the appellant took CENVAT credit of the service tax paid by them under Section 66A on the Netcool Suite imported by them. Thereafter, on 14.05.2010, they filed a refund claim for the Cenvat credit for period January to March, 2010 under rule 5 of Cenvat Credit Rules, 2004 read with Notification No. 5/2006-CE-NT dated 14.03.2006. A show cause notice was issued to them on 09.08.2010 seeking to deny the refund on the grounds that (a) both the input service and output service fall under the information technology services and (b) that the amounts credited a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SC)] 6. Rawmin Mining and Indus Ltd., Vs CCE [2009 (13) STR 269 (Tri-Ahmd)] He vehemently argued that there is no separate definition for input or input service either under Rule 5 or in the Notification No. 5/2006-CE dated 14.03.2006. Therefore, the definition under Rule 2 of CCR applies to the entire Cenvat Credit Rules including the refund under Rule 5 read with notification. It cannot be that a service is an input service under CCR, 2004 but it ceases to be so when it comes to refunding the amount under Rule 5. Since this issue has been settled in the judgments listed above they are entitled to refund. 4. His second argument was that both the lower authorities have erred in holding that they failed to establish the remittance of foreign exchange under FIRC covered by each invoice. They had submitted refund claim for the period January 2010 to March 2010. They had raised invoices for US $ 11,62,000 during that period and the invoices and corresponding FIRC number and date had been certified by the Chartered Accountant at the stage of show cause notice itself. He further submits that their banker has also since certified the amounts received against each invoice and correspon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Industries Limited [2010-259-ELT-356-Guj], held that refund of Cenvat Credit under Rule 5 of Cenvat Credit Rules, 2004 is also a refund under section 11B of Central Excise Act and accordingly the provisions of payment of interest under Section 11BB of the Act for delayed refunds fully apply to such refunds as well. Revenue had appealed against this judgment and Hon'ble Supreme Court had in Commissioner Vs Reliance Industries Ltd., [2011-274-ELT-A110-SC] held as follows: "Delay condoned. Having heard Learned Counsel for the respective parties and having considered the reasoning of the High Court, we are not inclined to entertain the Special Leave Petition and the same is accordingly dismissed." The ratio of this judgment squarely applies to them and therefore, he would submit, that they are also entitled to interest on the refund as claimed in their appeal. 7. Learned Departmental Representative reiterated the findings of the lower authority. He submits that as can be seen from the show cause notice at page 140 of the paper book there was no evidence of a linkage between the FIRCs and export invoices. In fact, the export proceeds were realized prior to the export itself. Theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owed only in respect of input service. If it is not an input service no refund can be sanctioned. If the Department had been negligent in not denying Cenvat Credit on the ground that the service in question is not an "input service" it is not estopped from examining the same at the time of sanctioning the refund as it is an essential requirement of the notification which enabled sanction of such refund. He, therefore, urged that the appeal is without merits and the same may be rejected. 9. We have carefully considered the arguments on both sides and perused the records. In the current round of litigation what is before us is the impugned order of the First Appellate Authority upholding the de-novo adjudication order of the original authority. From the documents presented before us including the agreement which the appellant had with M/s Softential Inc USA, the invoices , the FIRCs, the statement by the banker and the set off letter issued by the RBI we were convinced that what the appellant had imported is a software which they used to produce their export services. In fact, the service tax on the imported input service was paid by the appellant themselves under reverse charge mec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for exports made thereafter as well. 12. The third argument of the Department was that the so called export proceeds were realised even before the invoices were issued. The FIRCs do not show the invoice numbers and therefore there is doubt whether any foreign exchange has been realised at all against the so called exported services. Learned Counsel clarified that they had got a certificate from the Chartered Accountant certifying that the FIRCs pertain to receipts of foreign exchange for the exports concerned. He also produced a statement certified by their banker giving FIRC numbers and the export invoices to which the receipts pertain. He also submitted a copy of the set off certificate issued by the RBI permitting setoff of remittances for imports against remittances for exports. 13. FIRCs give details of remittances as they are received and during the course of business, these receipts may not be invoice wise. For instance, the amount against any one invoice may be received in parts. Similarly, an amount may be received in advance even before the exports were made which may be adjusted against the final invoice. In fact, even importers in India are allowed to remit to overse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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