Custom, Excise & Service Tax Tribunal
Commissioner Of Central Tax, Bengaluru ... vs Mphasis Software Services (India) Pvt ... on 22 March, 2024
Service Tax Appeal No.1836,1837,1838/2012
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
1st Floor, WTC Building, FKCCI Complex, K. G. Road,
BANGLORE-560009
Regional Bench COURT-2
Service Tax Appeal No. 1836 of 2012
[Arising out of the Order-in-Appeal No.56 to 58/2012 dated
29.03.2012 passed by the Commissioner of Central Excise
(Appeals-II), Bangalore.]
COMMISSIONER OF SERVICE TAX, .......Appellant
S.P. Complex, Lalbagh Road,
Service Tax Commissionerate,
Bangalore - 560 027.
VERSUS
M/s. MPHASIS SOFTWARE SERVICES .....Respondent
(INDIA) PVT. LTD.
Bagmane Technology Park, Byrasandra, C.V. Raman Nagar, Bangalore - 560 093 With Service Tax Appeal No. 1837 of 2012 [Arising out of the Order-in-Appeal No.56 to 58/2012 dated 29.03.2012 passed by the Commissioner of Central Excise (Appeals-II), Bangalore.] COMMISSIONER OF SERVICE TAX, .......Appellant S.P. Complex, Lalbagh Road, Service Tax Commissionerate, Bangalore - 560 027.
VERSUS M/s. MPHASIS SOFTWARE SERVICES .....Respondent (INDIA) PVT. LTD.
Bagmane Technology Park, Byrasandra, C.V. Raman Nagar, Bangalore - 560 093 Page 1 of 9 Service Tax Appeal No.1836,1837,1838/2012 AND Customs Appeal No. 1838 of 2012 [Arising out of the Order-in-Appeal No.56 to 58/2012 dated 29.03.2012 passed by the Commissioner of Central Excise (Appeals-II), Bangalore.] COMMISSIONER OF SERVICE TAX, .......Appellant S.P. Complex, Lalbagh Road, Service Tax Commissionerate, Bangalore - 560 027.
VERSUS M/s. MPHASIS SOFTWARE SERVICES .....Respondent (INDIA) PVT. LTD.
Bagmane Technology Park, Byrasandra, C.V. Raman Nagar, Bangalore - 560 093 Appearance:
Mr. K. Parameswaran, Advocate Appeared for Appellant Mr. Dyamappa Airani, Authorized Representative for Respondent Coram:
Hon'ble Mr. P.A. Augustian, Member (Judicial) Hon'ble Mr. Pullela Nageswara Rao, Member (Technical) FINAL ORDER No. 20201-20203_ of 2024 Date of Hearing: 12.12.2023 Date of Decision: 22.03.2024 PER: P.A. AUGUSTIAN
1. The Respondent herein is registered under Management Consultant, consulting Engineers, Manpower recruitment agency, maintenance or repair service. Towards un utilized CENVAT Page 2 of 9 Service Tax Appeal No.1836,1837,1838/2012 credit, Respondent had filed a refund claim for Rs. 42,73,752/-
,Rs.4,08,01,708/- & Rs.45,47,264/- on the ground that the input services have been used in the export of output service. The Adjudicating authority held that the assessee had not produced any evidence in support of the utilization of the input services for the export service, there is no documentary evidence with regard to the use of the services, not submitted the rent agreement in respect of the input service provider, there is no correlation with the FIRC and export invoices ..etc. Thus the claim was rejected by the Adjudication authority. Aggrieved by said order, an Appeal was filed before the Commissioner (Appeals) and Commissioner (Appeals) held that as per the records, there is no ambiguity in the factual position that Appellant was in possession of Centralized registration under Service Tax with effect from 20.03.2007 and got registered with the Department for ITSS on 22.04.2010. Under the circumstances, it is apparent that Appellant has exported output services from registered premises only and not from un- registered premises as held by Adjudicating authority. Other contentions raised by the Adjudication authority while rejecting the refund application also found unsustainable by the Appellate Authority and allowed the appeal.
2. Aggrieved by above said order of the Commissioner (Appeals), Appellant filed present appeal. When the matter came up for hearing, Ld AR submits that there was no registered premises existed in respective of output services exported by the Page 3 of 9 Service Tax Appeal No.1836,1837,1838/2012 assesses as ST Registration for the export was ITSS obtained only on 22.04.2010. It is further submits that the Appellate authority without verifying the documents including payment particulars, allowed the appeal. Ld AR also submits that the Commissioner (Appeals) has made only certain observations regarding unsustainability of the order issued by Adjudication authority partially and ought to have allowed the refund also partially. However in the order portion, the appeal is allowed fully as prayed by the Respondent herein.
3. Ld Counsel appearing for the Respondent submits that prima facie present appeals are infructuous. Pursuant to the common impugned Order-in-Appeal Nos.56-58/2012 dated 29.03.2012 passed by the then Commissioner (Appeals-II), Bangalore and upon dismissal of the Stay Applications filed by the Department by this Tribunal vide orders dated 04.09.2013, 11.09.2013 & 12.08.2013, the said refund claims involved herein had been taken up for further adjudication by the then jurisdictional Assistant Commissioner of Service Tax, Bangalore and the above said common Order-in-Original Nos. 105/2014- Refund (C No. IV/16/72/2012 ST DIV II R-IV, Denovo) dated 09.06.2014 came to be passed as per the order of the Commissioner's (Appeals).
4. When the present appeals were came up for hearing on 20.09.2021, as directed by this Tribunal, Learned AR produced a memo specifying that the refund was made as follows:- Page 4 of 9
Service Tax Appeal No.1836,1837,1838/2012 Period Refund claim Refund revised in Denovo In Rs. Adjudication Jan-09 to Mar -09 42,73,752 6,09,767 April-09 to June-09 4,08,01,708/- 23,07,207 July-09 to Sept-09 45,47,264 18,50,270
5. Appellant accepted said Order-in-Original. Even cash refund of the sanctioned amount against said common Order-in-
Original dated 09.06.2014 had been paid. The above said common Order-in-Original dated 09.06.2014 had not been challenged or disputed, either by the Department or the Respondent herein till date. Hence present departmental appeals covering the above said amount is prima facie deserve to be rejected/dismissed thereof as infructuous.
6. Regarding the submission on merit, Ld Counsel for the Respondent submits that the Appellant was holding valid registration for providing export services. Respondent has been registered with Service Tax Department on a Centralized basis in 20.03.2007 itself and registration of all service categories or all service specified in the refund notification is not statutorily provided and said non registration of a specific category cannot be result in denial of benefit. Ld Counsel draw our attention to the judgment of Hon'ble High Court of Karnataka in the matter of M/s JK Tyre & Industries Vs ACCE (2016 (340) E.L.T 193) and the Circular No. 112/06/2009-ST dated 12.03.2009 wherein it is clarified that even if the service provider is registered for Page 5 of 9 Service Tax Appeal No.1836,1837,1838/2012 providing one service, refund cannot be denied in respect of input services used in export of goods as held by the Appellate authority in the impugned order. Further submits that Respondent has submitted all the relevant documents and the details of the same was taken note by the Commissioner (Appeals) while allowing the appeal.
7. Regarding the allegation that there is no nexus between the input services and output services, Ld Counsel draw our attention to the Circular dated 19.01.2010 and also judgments of this Tribunal in the matter of CCE Vs M/s Ravi Foods Ltd (2011 (271) E.L.T 436 (Tri. Bang) , M/s Nitin Spinners Ltd Vs CCE (2017 (52) STR 172 (Tri.Del), CST Vs Nuware Systems (P) Ltd (2013 (31) STR 716), CCE Vs Tilda Riceland Pvt Ltd (2015 (323) E.L.T 615 (Tri.Del), M/s TVS Motor Company Ltd Vs CCE (2017 (5) GSTL 85 (Tri.Bang), M/s S.K Timber & Company Vs CC (Port) (2021 (377) E.L.t 454 (Tri.Kol), Pr. CCT Vs Huwaei Technologies India Pvt Ltd (2022 (60) GSTL 24 (Kar), P.A Consulting Services (India) Pvt Ltd Vs CCE (2017 (5) GSTL 33), CST Vs E-Care India Pvt Ltd (2017 (52) STR 246 (Mad), M/s Eveready Industries India Ltd Vs CESTA (2016 (337) E.L.T 189 (Mad.).
8. Regarding the ground taken by the Department related to the power of Appellate Authority to remand the issue, Ld Counsel draw our attention to the judgment of Hon'ble High Court of Madras in the matter of M/s AS Babu Sha Designs (2020 (38) GSTL (161) (Mad).
Page 6 of 9
Service Tax Appeal No.1836,1837,1838/2012
9. Heard both side. We have gone through the finding given by the Adjudication/Appellate authority and the submission made by both sides. It is an admitted fact that Appellant has made claim the refund of CENVAT credit for the services rendered by them for export of goods. While considering the issue in the matter of M/s Eveready Industries India Ltd (Supra), the Tribunal held that:-
50. The very same argument now advanced by the Department to the effect that Sections 11A and 35E operate in two different independent fields was raised by them. After considering the issue elaborately and also after taking note of the decision in Asian Paints (India) Limited approved by the Supreme Court, this Court came to the conclusion in Paragraph 23 as follows :
"In our opinion, there is no nexus between Section 11A and Section 35E. Section 11A does not indicate that the legislature intended to override Section 35E. Both sections have to be read harmoniously. In the present case, Annexure-I certificate has been issued in favour of the petitioners from time-to-time on executing B-8 security bond and on furnishing a bank guarantee. The Department has to follow the procedure under Section 35E for setting aside the Annexure-I certificate. Unless, the Annexure-I certificate is cancelled or rejected by the Competent Authority, by following the procedure under Section 35E, it is not permissible for the respondents to invoke Section 11A of the Act. Therefore, we are of the considered opinion that the issuance of show cause notices is without jurisdiction and is liable to be struck down."
51. We are of the considered view that the paragraph extracted above is a complete answer to the question of law now raised. Unfortunately, in none of the decisions relied upon by the learned standing counsel, the Courts were confronted with an order of adjudication passed under Section 11B on an application. Once an application for refund is allowed under Section 11B, the expression 'erroneous refund' appearing in sub-section (1) of Section Page 7 of 9 Service Tax Appeal No.1836,1837,1838/2012 11A cannot be applied. If an order of refund is passed after adjudication, the amount refunded will not fall under the category of erroneous refund so as to enable the order of refund to be revoked under Section 11A(1). One authority cannot be allowed to say in a collateral proceeding that what was done by another authority was an erroneous thing. Therefore, the question of law has to be answered in favour of the appellant/assessee and the appeal deserves to be allowed.
10. Similarly in the matter of M/s mPortal India Wireless Solutions P Ltd Vs CST (2012 (27) STR 134 (Kar.) it is held that:-
7. Insofar as requirement of registration with the department as a condition precedent for claiming Cenvat credit is concerned, learned counsel appearing for both parties were unable to point out any provision in the Cenvat Credit Rules which impose such restriction. In the absence of a statutory provision which prescribes that registration is mandatory and that if such a registration is not made the assessee is not entitled to the benefit of refund, the three authorities committed a serious error in rejecting the claim for refund on the ground which is not existence in law. Therefore, said finding recorded by the Tribunal as well as by the lower authorities cannot be sustained. Accordingly, it is set aside.
11. One of the ground in the present appeals is that as per impugned order, appellate authority only allowed the appeal partially whereas in the order portion, it is this allowed without any quantification. However as per the memo filed by the appellant on 01.11.2021, in De-novo adjudication, adjudicating authority only allowed refund partially as directed by the first appellate authority and not sanctioned full refund as claimed by the appellant in the grounds of appeals. Page 8 of 9
Service Tax Appeal No.1836,1837,1838/2012
12. Considering the facts and circumstances as stated above, the Commissioner appeals rightly passed impugned order considering the statutory provision and decisions of the appellate authorities. Hence there is no infirmity in the impugned orders. Moreover disputes is settled by common Order-in-Original Nos. 105/2014-Refund (C No. IV/16/72/2012 ST DIV II R-IV, Denovo) dated 09.06.2014 came to be passed as per impugned order.
13. Hence the Appeals are dismissed.
(Order Pronounced in Open court on 22.03.2024) (P.A. Augustian) Member (Judicial) (Pullela Nageswara Rao) Member (Technical) Ganesh Page 9 of 9