Custom, Excise & Service Tax Tribunal
M/S. Schmetz India Pvt. Ltd vs Commissioner Of Central Excise on 2 November, 2016
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeals (s) Involved: E/28339, 28340, 28341/2013-DB (Arising out of Order-in-Appeal No.356/2013 dated 26.8.2013; OIA No.367/2012 dated 28.8.2013; & OIA No.369/2013 dated 28.8.2013 passed by the Commissioner of Central Excise (Appeals-II), Bangalore.) M/s. Schmetz India Pvt. Ltd. Appellant(s) versus Commissioner of Central Excise Bangalore. Respondent(s)
Appearance:
Shri H.Y. Raju, Advocate For the Appellant Shri Mohammed Yousuf, AR For the Respondent Date of Hearing: 31/08/2016 Date of Decision: 02/11/2016 CORAM:
Mr. Mohammed Yousuf, AR For the Respondent HON'BLE SHRI S.S. GARG, JUDICIAL MEMBER Date of Hearing: 30/09/2016 Final Order No. _21058-21060_/ 2016 Per : S.S. GARG The appellant have filed three appeals and in all the three appeals identical issue is involved and therefore all the three appeals are being disposed of by this common order. Briefly the facts of the present case are that the appellant is engaged in the manufacture and export of industrial sewing machine needles falling under Chapter subheading 8452 30 of the First Schedule of CETA 1985. The appellant being a 100% EOU is not in a position to utilise the CENVAT credit availed on input and input services in terms of provisions of CENVAT Credit Rules 2004, hence the appellant in Form-A along with the relevant document as prescribed in the Notification No.5/2006 CE dated 14.3.2006 as amended issued under Rule 5 of CCR, 2004 on 21.12.2010 filed the refund claim for different period as shown in the table below: Appeal No. OIO OIA Period Amount E/28339/2013 No.1/2011 dated 3.1.2011 No.356/2013 dated 26.8.2013 July September 2009 Rs.1,16,241/-
E/28340/2013 No.42/2011 dated 24.6.2011 OIA No.367/2012 dated 28.8.2013 January March 2010 Rs.1,67,863/-
E/28341/2013 No.22/2011 dated 21.4.2011 OIA No.369/2013 dated 28.8.2013 October December 2009 Rs.1,60,298/-
The refund sanctioning authority vide various Orders-in-Original as stated supra after examining the conditions specified by the appellant as required under the said Notification and after considering the verification report dated 30.12.2010 signed by the jurisdictional range officer has allowed the refund of unutilised CENVAT credit in cash of service tax paid on input services. Aggrieved by the Orders-in-Original passed by the sanctioning authority, the department reviewed the Orders-in-Original by filing the appeals before Commissioner of Central Excise (Appeals), Bangalore on the ground that the adjudicating authority has sanctioned the refund without giving any finding on the usage of the said input services and the said inputs in the manufacture of final product. The said services are not at all input services in manufacturing of their final product and also on the ground that there is no documentary evidence to show that the said input services have been used in relation to the manufacture of final product. Aggrieved by the said order, the appellants preferred the present appeals.
2. I have heard the learned counsel for the appellant and perused the records. The learned counsel for the appellant submitted that the impugned order is against the provisions of Section 35A inasmuch as the learned Commissioner (A) does not have the power to remand and has erroneously remanded the case to the adjudicating authority. The learned counsel further submitted that in the impugned order, the learned Commissioner (A) has failed to appreciate that the adjudicating authority has given detailed findings and also considered the report of the jurisdictional range officer before sanctioning the refund of the unutilised CENVAT of duty and service tax paid on the input and input service. He further submitted that once the availment of CENVAT credit of duty or service tax paid on inputs or input services is accepted and not objected to, the refund proceedings in terms of Notification No.5/2006 dated 14.3.2006 under Rule 5 of CCR cannot be used to determine at that stage whether a service or goods is an input service or input or not. Similarly having allowed an assessee to avail the credit and not objected to the same at the time of availment, the question as to whether such goods or services are used in or in relation to the manufacture and export of goods cannot be gone into at the time of considering the refund claim. The learned counsel further submitted that the learned Commissioner in all fairness appreciating the findings of the adjudicating authority and considering the OIA No.136/2009 dated 26.10.2009 in the appellants own case for the earlier period sanctioned the refund on similar services which is also accepted by the department without filing the appeal, ought to have upheld the order of adjudicating authority and dismiss the appeal of the department. Further the learned counsel submitted that in respect of each input service and its utilisation in or in relation to the manufacture has relied upon the case laws which are mentioned below:
Sl. No. Services Relied upon case laws
1.
Telephone Service * M/s. BPCL vs. CCE, Mumbai: 2012-TIOL-668-CESTAT-MUM * M/s. Rajashree Cemtns vs. CCE, Belgaum: 2012-TIOL-1956-CESTAT-BANG.
* CCE vs. Excel Corp. Care Ltd.: 2008-TIOL-568-HC-AHM-CX.
* M/s. Semco Electrical Pvt. Ltd. vs. CCE: 2010-TIOL-162-CESTAT-MUM.
* Semco Electric Pvt. Ltd. vs. CCE, Pune: 2011-TIOL-1579-CESTAT-MUM.
2. Courier Service * M/s. Piramala Healthcare Ltd. vs. CCE, Raigad: 2012-TIOL-1990-CESTAT-MUM.
* M.s, Semco Electric Pvt. Ltd. vs. CCE, Pune-I: 2011-TIOL-965-CESAT-MUM.
* Tufropes Pvt. Ltd. vs. CCE, Vapi: 2012 (277) ELT 359 (Tri.-Ahmd.)
3. Export (Clearance) * M/s. MTR Foods Ltd. vs. CCE, Bangalore: 2011-TIOL-947-CESTAT-BANG.
* Semco Electric Pvt. Ltd. vs. CCE, Pune: 2011-TIOL-1579-CESTAT-MUM.
4. Job Work Charges * CCE, Nagpur vs. Ultratech Cement Ltd.: 2010 (20) STR 577 (Bom.)
5. Professional Charges * Jeans Knit Pvt. Ltd. vs. CC, Bangalore: 2011 (21) STR 460 (Tri.-Bang.) * M/s. Life Long Indian Ltd. vs. CCE, Delhi-III: 2011-TIOL-832-CESTAT-DEL.
6. Repair and Maintenance (factory building) * Zydus Nycomed Healthcare Pvt. Ltd. vs. Belapur: 2013-TIOL-537-CESTAT-MUM.
7. Repair and Maintenance (Machinery) * M/s. Castrol India Ltd. vs. CCE, Vapi: 2013 (291) E.L.T. 469 (Tri.-Ahmd.) * J.K. Sugar Ltd. vs. CCE, Meerut-II: 2012 (26) S.T.R. 391 (Tri.-Del.)
8. Security Service * M/s. MRF Ltd. vs. CCE & ST (LTU), Chennai: 2013 (31) STR 689 (Tri.-Chennai) * M/s. Valco Industries Ltd. vs. CCE, Chandigarh: 2012 (28) S.T.R. 457 (Tri.-Del.)
9. Service (Sewage Water Treatment Plant) * CCE, Delhi-III vs. M/s. Minda Acoustics Ltd.: 2013-TIOL-894-CESTAT-DEL.
* M/s.Ultra Tech Cement Ltd. vs. CCE, Nagpura: 2009-TIOL-2131-CESTAT-Mum.
* M/s. Ultra Tech Cement Ltd. vs. CCE, Nagpura: 2011-TIOL-182-CESTAT-Mum.
* CCE & ST (LTU) vs. M/s. Lupin Ltd.: 2012 (285) E.L.T. 221 (Tri.-Ahmd.)
10. Travel Service * Zydus Nycomed Healthcare Pvt. Ltd. vs. CCE, Belapur: 2013-TIOL-537-CESTAT-MUM. * M/s. Semco Electrical Pvt. Ltd. vs. CCE, Pune: 2010-TIOL-162-CESTAT-MUM.
* M/s. Hindustan Zinc Ltd. vs. CCE, Jaipur: 2013-TIOL-572-CESTAT-MUM.
* CCE, Bangalore-III vs. Stanzen Toyotetsu India (P) Ltd.: 2011-TIOL-866-HC-KAR-ST
3. Learned counsel submitted that all the services on which CENVAT credit has been denied are held to be input services by various judgments cited supra. On the other hand, the learned AR reiterated the findings in the impugned order.
4. After considering the submissions of both the parties and perusal of the records and the judgments cited supra, I am of the considered opinion that the impugned order is not sustainable in law as all the services involved in the present appeals have been held to be input services by various decisions of the Tribunal and the High Court cited supra. Further, I also note that with regard to all the services the Commissioner (A) in the appellants own case for the earlier period vide his Order-in-Appeal No.136/2009 dated 26.10.2009 has allowed the refund under Rule 5 of CCR, 2004 and the department has not filed appeal against the same. In view of this situation, the impugned orders are liable to be set aside and I set aside the impugned orders by allowing all the three appeals with consequential relief, if any.
(Order was pronounced in Open Court on 02/11/2016.) S.S. GARG JUDICIAL MEMBER rv 7