Custom, Excise & Service Tax Tribunal
C-Cubed Solutions Private Limited vs Cce, Bangalore(Adjn) on 1 May, 2014
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Final Order No.21488-21489 / 2014 Appeal(s) Involved: ST/438/2009-SM, ST/439/2009-SM [Arising out of OIA No.321-2008 and No.323-2008 both dated 28/11/2008 passed by CCE(Appeals-II), Bangalore, ] C-CUBED SOLUTIONS PRIVATE LIMITED NO 3&4,SREE VENKAT REDDY LAYOUT,OFF 80FEET ROAD,KORAMANGALA, BANGALORE Appellant(s) Versus CCE, BANGALORE(ADJN) NULL Respondent(s)
Commissioner of Central Excise,Customs and Service Tax BANGALORE-LTU NULL 100 FT RING ROAD JSS TOWERS, BANASHANKARI-III STAGE, BANGALORE, - 560085 KARNATAKA Respondent(s) Appearance:
Ms. Manju George, Consultant For the appellant Dr. A.K. Nigam, Addl. Commissioner(AR) For the respondent CORAM:
HON'BLE SHRI S.K. MOHANTY, JUDICIAL MEMBER Date of Hearing: 01/05/2014 Date of Decision: 01/05/2014 Order Per : S.K. MOHANTY The facts involved in both the appeals are common. Therefore, the same are disposed of by this common order.
2. The brief facts of the case are that the appellant is a subsidiary of M/s. Customer Focus Services Inc., USA and provides IT enabled services to the clients of the said foreign company. The appellant is a 100% export processing unit registered with the Software Technology Parks of India (STPI). The appellant is rendering taxable service of Online Data Retrieval or Access, for which it is registered under the provisions of Section 69 of the Finance Act, 1994. During the disputed period, the appellant had claimed refund of service tax paid on input services under Rule 5 of the Cenvat Credit Rules, 2004 read with Notification No.5/2006-C.E. (N.T.) dt. 14/03/2006. The authorities below have allowed refund of service tax with regard to some of the services and disallowed the benefit for certain other services, on the ground that the services are not directly or indirectly related to the export services rendered by the appellant. The said services are towards renting of furniture, housekeeping services, annual maintenance contract and for food coupons.
3. The learned consultant appearing for the appellant has explained the nexus between the input services and the output services. According to the learned counsel, the furniture was hired for use by new recruits who were engaged in the export activities of the appellant. With regard to housekeeping, she submitted that the said services were used for up-keepment of the premises from where export activities were carried out. The maintenance services were obtained for maintenance of UPSs and maintenance of computer networks. The food coupons were purchased for provision of food to staff during office hours. According to the learned consultant, the services were used for the activity relating to business, which was eligible for credit as per the definition of input service contained in Rule 2(l) of the CENVAT Credit Rules, 2004. The learned consultant has cited the Final order No.571 & 572 dt. 10/08/2012 passed in Appeal No.ST/361 & 308/2009 by this Bench of the Tribunal wherein services relating to hiring of furniture and housekeeping have been allowed as eligible for input credit and consequently refund has been sanctioned. He further referred to the circular No.120/01/2010-ST dt. 19/01/2010 issued by CBEC, wherein the outdoor catering service has been considered as an eligible input service for export of output services.
4. The learned A.R. appearing for the revenue has reiterated the findings recorded in the impugned order.
5. Heard the learned counsel for the parties and perused the records. On perusal of the definition of 'input service' as contained in Rule 2(l) of the Cenvat Credit Rules, 2004, it would reveal that the substantive part covers services used by a provider of taxable service for providing the output service; whereas, the inclusive part covers various services, which have been used/utilised by the service provider for accomplishing its business activities. In other words, the services envisaged in the inclusive part of the definition is very broad and a narrow interpretation cannot be placed to infer, without proper discussion, that certain services have no nexus with the output service provided by the service provider.
6. The nature, purpose and use of the disputed services by the appellant as explained in the grounds of appeal (referred supra), to my opinion, establish the fact that the expenditure incurred for those services are commercially required to be incurred with a view to facilitate carrying on the business as a service provider, and thus, confirming to the expression 'activities relating to business' as contained in the definition clause of 'input service'; as the word 'business' is one of wide import and in fiscal statutes, it must be construed in a broad rather than a restricted sense.
7. In view of above, I am of the considered opinion that the disputed goods indicated above should merit consideration as 'input service', since those services have nexus with the output service provided by the appellant. Therefore, the appeal filed by the appellant is allowed with consequential relief as per law.
(Operative portion of the order has been pronounced in open court) S.K. MOHANTY JUDICIAL MEMBER Raja 4