Custom, Excise & Service Tax Tribunal
Reitzel India Pvt. Ltd vs Commissioner Of Service Tax Bangalore on 2 January, 2017
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Appeal(s) Involved: ST/23538/2014-SM [Arising out of Order-in-Appeal No. 465/2014 dated 31/07/2014 passed by the Commissioner of Central Excise, Bangalore-I (Appeals)] Reitzel India Pvt. Ltd. Plot No.98-88, KIADB Industrial Area, Anchepalya Village, Kunigal Tumkur 572 130 Karnataka Appellant(s) Versus Commissioner of Service Tax Bangalore 1st To 5th Floor, TTMC Building, Above BMTC Bus Stand, Domlur Bangalore 560 071 Karnataka Respondent(s)
Appearance:
Shri K. Hariharan, CA 231, Krishna, 32-A Cross, 7th Block Jayanagar, Bangalore - 560 082 For the Appellant Shri Mohd Yusuf, AR For the Respondent Date of Hearing: 02/01/2017 Date of Decision: 02/01/2017 CORAM:
HON'BLE SHRI S.S GARG, JUDICIAL MEMBER Final Order No. 20006 / 2017 Per: S.S GARG The present appeal is directed against the impugned order dated 31.07.2014 passed by the Commissioner (Appeals) whereby the Commissioner (Appeals) allowed the appeal of the Department against the Order-in-Original and set aside the Order-in-Original and held that the respondents are not eligible for refund of Rs. 5,385/- (Rupees Five Thousand Three Hundred and Eighty Five only) for cenvat credit taken on outward transportation. Briefly the facts of the case are that the appellant is a 100% EOU engaged in the manufacture and export of processed Gherkins. Appellant is an agro-based industry of processing gherkins which are packed in drums, jars and tins and exported to USA, Europe and Russia. Appellant incurs various expenses directly or indirectly for the manufacture of final products or activities relating to the business. For the quarter April to June 2011, the appellant filed a refund claim of Rs. 5,79,014/- (Rupees Five Lakhs Seventy Nine Thousand and Fourteen only) representing unutilized cenvat credit as per Rule 5 of the Cenvat Credit Rules, 2004 read with Notification 5/2006 dated 14.03.2006. The entire refund was sanctioned vide Order-in-Original dated 26.08.2012 passed by the Assistant Commissioner. On Departments appeal before the Commissioner (Appeals), an amount of Rs. 5,385/- (Rupees Five Thousand Three Hundred and Eighty Five only) was rejected vide Order-in-Appeal dated 31.07.2014. Aggrieved by the said order, the appellant has filed the present appeal.
2. Heard both the parties and perused the records.
3. The learned counsel for the appellant submitted that the impugned order rejecting the refund of Rs. 5,385/- (Rupees Five Thousand Three Hundred and Eighty Five only) for the quarter April to June 2011 is not sustainable in law as the same has been passed without considering the transport bills. He further submitted that all the disputed expenses fall within the definition of input service in Rule 2(l) of the Cenvat Credit Rules 2004 as the same relates to inward freight but the Commissioner (Appeals) has wrongly considered the same as outward freight examining the transport bills. He further submitted that in the subsequent adjudication, service tax paid on clearing charges has been allowed as refund. He also submitted that the Commissioner (Appeals) in the appellants earlier appeal sanctioned the refund on the same instance. He also submitted that the clearing charges/inward freight is specifically covered in the amended definition of input service as contained in Rule 2(l) of the Cenvat Credit Rules and in support of his submission, he relied upon the following authorities:
(i) Rashtriya Ispat Nigam Ltd. Vs. Commissioner of Central Excise, Visakhapatnam 2010 (26) STT 405 (Bang-CESTAT)
(ii) Jeans Knit (P) Ltd. V. Commissioner of Customs, Bangalore 2011 (30) STT 434 (Bang.-CESTAT)
(iii) Toyota Kirloskar Motor P. Ltd. Vs. CCE (L.T.U) 2011 (24) STR 645 (Kar.)
(iv) CCE Vs. Ultratech Cement Ltd. 2010 (20) S.T.R. 577 (Bom.)
(v) Coco Cola India Pvt. Ltd. Vs. CCE 2009 (1) STR 657 (Bom.)
(vi) CCE, Bangalore Vs. Stanzen Toyotetsu India Pvt. Ltd. 2011 (23) S.T.R. 444 (Kar.-HC)
(vii) ANZ International Vs. Commissioner of Customs, Bangalore [2008 (224) E.L.T. 573 (Tri.-Bang.)] ANZ decision was subsequently upheld by Karnataka High Court in [2009 (233) E.L.T. 40 (Kar.)] and SLP was dismissed by Honble Supreme Court [2009 (240) E.L.T. A16 (S.C)]
4. On the other hand the learned AR reiterated the findings of the impugned order.
5. After considering the submissions of both the parties and perusal of the judgments cited supra, I am of the opinion that the impugned order is not sustainable in law in view of the ratios of the judgment cited supra and therefore I set aside the impugned order by allowing the appeal of the appellant with consequential relief, if any.
(Operative portion of the Order was pronounced in Open Court on 02/01/2017) (S.S GARG) JUDICIAL MEMBER iss