Custom, Excise & Service Tax Tribunal
Strides Arcolab Ltd vs Commissioner Of Central Excise, ... on 2 December, 2016
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: E/20261/2014-SM [Arising out of Order-in-Appeal No. 520/2013 dated 30/09/2013 passed by the Commissioner of Central Excise, Bangalore-I (Appeals)] Strides Arcolab Ltd. No.36/7, KRS Gardens, Surajagakkanahalli, Indalwadi Cross, Anekal Taluk, Bangalore 562 106 Karnataka Appellant(s) Versus Commissioner of Central Excise, Customs and Service Tax Bangalore-I Post Box No. 5400, C.R Buildings, Bangalore - 560 001 Karnataka Respondent(s)
Appearance:
Shri Akbar Basha, CA Hiragange & Associates #1010, 1st floor(Above Corp.Bank) 26th Main, 4th T Block, Jayanagar, Bangalore 560 041 Karnataka For the Appellant Shri Mohammed Yusuf, AR For the Respondent Date of Hearing: 02/12/2016 Date of Decision: 02/12/2016 CORAM:
HON'BLE SHRI S.S GARG, JUDICIAL MEMBER Final Order No. 21352 / 2016 Per: S.S GARG The present appeal is directed against the impugned order passed by the Commissioner (Appeals) vide his order dated 30.09.2013 whereby the Commissioner (Appeals) has partly allowed the appeal of the assessee. Aggrieved by the said order, the appellant has filed the present appeal. Briefly the facts of the case are that the appellant is a 100% EOU engaged in the manufacture of pharmaceutical products and formulations. For the period January 2010 to March 2010, appellant files refund claim seeking refund of unutilized cenvat credit on input services and inputs. Appellant was partially sanctioned the refund claim and was denied balance refund claim on the ground of being time-bar. Further refund claim on input services was rejected on the ground that no nexus between input services and manufactured goods was provided by the appellant. Aggrieved by the Order-in-Original the appellant preferred an appeal before the Commissioner and the Commissioner also partially allowed the appeal. The Commissioner has rejected the appeal on the following grounds:
The claim of Rs. 1,54,329/- (Rupees One Lakh Fifty Four Thousand Three Hundred and Twenty Nine only) has been filed beyond the period of one year from the date of export of the impugned goods. As regards calibration charges towards maintenance of machineries or production equipment to test the temperature/density of the same, no documentary evidence was produced. Similarly for freight inwards of Rs. 391/- (Rupees Three Hundred and Ninety One only), no documentary evidence was produced and with regard to other services the refund was rejected on account of lack of nexus. Aggrieved by the said order, the appellant filed the present appeal.
2. I have heard the learned counsel for the parties and perused the records.
3. The learned counsel for the appellant submitted that the impugned order is not sustainable in law as the same is passed without considering the provisions of the Act as well as judgments rendered by the higher judicial forum. He further submitted that there is no time limit for claiming refund under Rule 5 of the Cenvat Credit Rules and the learned Commissioner (Appeals) has wrongly invoked Section 11B of the Central Excise Act for denying the refund being time-barred. As far as denying refund on input services like calibration charges and freight charges, the counsel for the appellant fairly conceded that they could not produce the requisite documents justifying the claim. The learned counsel further submitted that as far as other input services viz. Catering Charges, Freight outwards, Rent Charges, Xerox Machine Charges are concerned, they are very much fall in the definition of input service as contained in Rule 2(l) of the Cenvat Credit Rules 2004. In support of his submission, he relied upon the following case-laws:
Category of Service Submissions Case Laws relied upon Catering charges Supply of food and refreshments to operators, staff etc. at the plant who are directly involved in the manufacturing activity. Statutory requirement as per the Factories Act Employees are more than 250 in number. Appellants in its earlier order OIA No. 200/2013-CE dated 19.04.2013 has granted refund on canteen services. 1. CCE Vs. Stanzen Toyotetsu India (P) Ltd. 2011 (23) STR 444 (Kar.)
2. BNY Mellon International Operations (I) P. Ltd. Vs. CCE (A) Pune-III 2013 (30) STR 567 (Tri.-Mumbai)
3. SEMCO Electrical Pvt. Ltd. Vs. CCE, Pune 2010 (18) STR 177 (Tri.-Mumbai)
4. CST Vs. Jubilant Biosys Ltd. 2016 (42) STR 729 (Tri.-Bang.)
5. M/s. Reliance Industries Ltd. Vs. C. Ex. & ST, LTU, Mum. 2016-TIOL-2392-CESTAT-MUM Freight outward In case of exports place of removal is the port hence eligible credit. 1. Delta Energy Systems Ltd. Vs. CCE 2013 (31) STR 684 (Tri.-Del.)
2. Adani Pharmachem (P) Ltd. Vs. CCE 2009 (238) ELT 179 (Tri.)
3. CCE Vs. Pokarna Ltd. 2013 (292) ELT 316 (Tri.-Bang.) Rent charges This service is used towards storage of QA/QC records/documents 1. Jeans Knit P Ltd. Vs. CC 2011 (21) STR 460 (Tri.-Bang.)
2. M/s. Reliance Industries Ltd. Vs. C. Ex. & ST, LTU, Mum. 2016-TIOL-2392-CESTAT-MUM
3. HCL Technologies Ltd. Vs. C. Cus., Ex., & ST, Noida 2015 (40) STR 1124 (Tri.-Del.)
4. Alliance Global Services IT (I) (P) Ltd. Vs. CC, CE & ST, Hyderabad-II 2016 (42) S.T.R. 438 (Tri.-Hyd.) Xerox machine charges These services are used for maintaining photo copying machine which is necessary for processing of documents used by the quality control department besides for accounting and administrative purposes. 1. Parason Machinery (I) Pvt. Ltd. Vs. CCE 2009 (16) STR 20 (Tri.-Mum.)
2. Megma Design Automation (I) Pvt. Ltd. Vs. Commr. of S.T, Bangalore 2015 (40) S.T.R. 800 (Tri.-Bang.)
3. BAL Pharma Ltd. Vs. Commr. of C. Ex., Cus. & S.T., Bangalore I 2014 (34) S.T.R. 752 (Tri.-Bang.)
4. On the other hand the learned AR reiterated the findings of the impugned order and submitted that the part of the refund under Rule 5 of the Cenvat Credit Rules has been rightly rejected being time-barred as the same has been filed beyond one year from the relevant date. In support of his submission, he submitted that Condition No. 6 under Notification No. 5/2006 dated 14.03.2006 clearly says that the application in Form A along with prescribed enclosures and the relevant extracts of the records maintained under the Central Excise Rules, 2002, Cenvat Credit Rules, 2004, or the Service Tax Rules, 1994 in original were filed with the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be before the expiry of the period specified in Section 11B of the Central Excise Act, 1944. Keeping in view the provisions of Section 11B, the refund claim was barred by limitation as the same had been filed beyond the expiry of one year from the relevant date i.e. the date of export of the goods. The following case-laws are relevant in this case:
a) Anam Electrical Manufacturing Co. 1997 (90) E.L.T. 260 (S.C)
b) M/s. MCI Leasing (P) Ltd. Mysore 2012-TIOL-54-HC-KAR-ST
c) Ananti Feeds Ltd. 2007 (213) E.L.T. 280 (Tri.-Bang.)
d) XL Telecom Ltd. 2006 (206) E.L.T. 303 (Tri.-Bang.)
e) Miles India Limited 1987 (30) E.L.T. 641 (S.C)
f) Agro Pack 2009 (238) E.L.T. 750 (Tri.-Ahmd.)
g) CCE, Raipur Vs. Manorath Builder (P) Ltd. 2010 (18) S.T.R. 453 (Tri.-Del.) Further with regard to the rejection of refund on various input services are concerned, I hold that the same was wrongly refused in view of the ratio of the decisions cited supra wherein all these services have been held to be input services. Therefore keeping in view the entire facts and circumstances, the appeal is partly allowed and it is held that a claim of Rs. 1,54,329/- (Rupees One Lakh Fifty Four Thousand Three Hundred and Twenty Nine only) is barred by limitation and further I allow the refund claim on various input services viz. Catering Charges, Freight Outward, Rent Charges and Xerox Machine Charges as cited supra subject to verification of the invoices. In view of my discussion above, I partly allow the appeal of the appellant with consequential relief, if any.
(Operative portion of the Order was pronounced in Open Court on 02/12/2016) (S.S GARG) JUDICIAL MEMBER iss