Custom, Excise & Service Tax Tribunal
Commissioner Of Gst & Central Excise vs M/S. Sutherland Global Services Pvt. ... on 2 March, 2018
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH, CHENNAI
Appeal No. ST/593/2010
(Arising out of Order-in-Original No. 17/2010 dated 23.6.2010 passed by the Commissioner of Central Excise, Chennai II)
Commissioner of GST & Central Excise
Chennai South Appellant
Vs.
M/s. Sutherland Global Services Pvt. Ltd. Respondent
Appearance Shri K. Veerabhadra Reddy, JC (AR) for the Appellant Shri Joseph Prabhakar, Advocate for the Respondent CORAM Honble Ms. Sulekha Beevi C.S., Member (Judicial) Honble Shri Madhu Mohan Damodhar, Member (Technical) Date of Hearing / Decision: 02.03.2018 Final Order No. 40562 / 2018 Per Bench The respondents are subsidiary company of M/s.Sutherland Global Services Inc. USA dealing with customer management service. They offer IT enabled service, technical help service, call centre service on behalf of clients viz. Microsoft, HP etc. whose customers are located outside India. They are registered with the Service Tax Department. During audit of accounts, it was noticed that the respondent has availed CENVAT credit on various input services which according to the department was not eligible for CENVAT credit. From October 2007 onwards, the respondents had started utilizing the CENVAT credit for payment of service tax for the services rendered in the domestic unit namely M/s.Verizon Data Services India Pvt. Ltd. Two show cause notices were issued proposing to recover the CENVAT credit amounting to Rs.1,24,54,319/- and Rs.72,68,867/- along with interest and for imposing penalties. After due process of law, the Commissioner dropped the proceedings for recovery of the CENVAT credit amounting to Rs.1,85,37,642/- thereby disallowing credit to the tune of Rs.11,85,544/- in respect of credit availed group medical insurance premium and insurance paid by the respondent. Aggrieved by allowing the credit, department has filed the present appeal.
2. On behalf of the Department, ld. AR Shri K. Veerabhadra Reddy reiterated the grounds of appeal.
3. The ld. counsel Shri Joseph Prabhakar appeared for the respondent and argued the matter. He submitted that the Commissioner has allowed the credit in respect of various services which have been used by the respondent for providing output services. The period involved is prior to 1.4.2011 when the definition of input services had a very wide ambit as it included the words activities relating to business. Therefore, Commissioner has rightly allowed the credit on such input services. He also relied on the decision of the Tribunal in the case of Knoah Solutions Pvt. Ltd. Vs. Commissioner of Central Excise, Hyderabad 2016 (44)STR 628 and submitted that the impugned services have been held to be eligible for credit in the said decision.
4. Heard both sides.
5. On perusal of the impugned order, we find that the Commissioner has discussed in detail as to how the various input services on which credit has been allowed is used directly or indirectly by the respondent. Further, during the relevant period, the definition of input services had a wide ambit as it included the words activities relating to business. In Coca Cola India Pvt. Ltd. Vs. Commissioner of Central Excise, Pune 2009 (242) ELT 168 (Bom.), the Honble High Court of Bombay has considered the eligibility of credit on various input services and held that almost all the services would come within the phrase activity relating to business. Therefore, we do not find any ground to interfere with the order passed by the Commissioner allowing credit on said service. The impugned order is upheld and the appeal filed by the Revenue is dismissed.
(Operative portion of the order was
pronounced in open court)
(Madhu Mohan Damodhar) (Sulekha Beevi C.S.)
Member (Technical) Member (Judicial)
Rex
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