By TIOL News Service

MUMBAI, DEC 11, 2015: THIS is a Revenue's appeal.

The respondent is registered for providing various taxable services including Information and Technology Services. The respondent acquired business of M/s. Infinite Data Technology Services Pvt. Ltd. Bangalore (M/s. IDSPL) under a business transfer agreement. In the said transaction M/s IDSPL charged a transfer fee to the respondent on which Service Tax of Rs.97,89,120/- was paid. The respondent subsequently realized that the ‘Business Transfer' is not taxable service during material period i.e. in the year 2012 and the same was not leviable to Service Tax.

Therefore, the respondent filed a claim seeking refund of erroneous payment of service tax. A SCN was issued and the refund was rejected on the ground that ‘Business Transfer' invoice raised by M/s IDSPL is in the name of M/s. Fujitsu, New Delhi , which was not included in the respondent's Service Tax registration.

The Commissioner (Appeals) set aside the Order-in-Original and allowed the appeal.

Before the CESTAT, the AR submitted that the bill for the service charges including Service Tax was raised by M/s IDSPL as a service provider to M/s. Fujitsu, New Delhi , who is service receiver, therefore,since the present respondent has neither paid service tax nor received the services, the respondent is not entitled for refund. It is further submitted that invoice was raised in the name of M/s. Fujitsu, New Delhi whereas refund was claimed by respondent who is located at Pune who has no locus standi. Moreover, although the respondent has a centralized registration, their Delhi office has not been included in the said registration and this is one more reason that the respondent cannot claim refund.

The respondent inter alia submitted that they had paid service charges along with service tax to M/s. IDSPL ;that Invoice was issued in the name of same entity at their Delhi office, however being one single entity, the books of accounts, trial balance etc. is common; even though the invoice was raised to the recipient at Delhi office merely for that reason refund cannot be denied;it is admitted by the Revenue that ‘Business Transfer' fees on which service tax was paid is not taxable, therefore, in any case the service tax paid is not service tax which cannot be retained by the department and the same has to be refunded;that there cannot be any other claimant other than M/s. IDSPL or the respondent; M/s. IDSPL has given disclaimer, ‘not made any claim', therefore, the only person entitled for refund claim is the respondent alone.

Reliance is also placed on various Tribunal decisions in which it is held that irrespective of Billing to any address of the assesse, credit can be availed at a place where centralized registration exists.

(a) Manipal Advertising Services Pvt. Ltd. Vs. CCE, Mangalore - 2011-TIOL-273-CESTAT-BANG

(b) RaajKhosla& Co. Pvt. Ltd. Vs. C.S.T, Delhi - 2007-TIOL-748-CESTAT-DEL

(c) Gujarat Heavy Chemicals Ltd. Vs. C.C.Ex, Rajkot - 2005-TIOL-641-CESTAT-MUM

The Bench after considering the submissions observed -

++ There is no dispute regarding payment of service tax and incidence of the same was borne by the respondent. As regard the invoice raised by the M/s. IDSPL in favour of respondent at Delhi address, it does not make any difference for processing the refund claim for the reason that Delhi office of the Respondent is their registered office and the same is not different entity, it is integral part and parcel of the one company of the respondent. The respondent having centralized registration at Pune, have correctly lodged their claim at Pune, particularly when the Service Tax by M/s. IDSPL was also paid in Pune only.

++ It is settled legal position that even though the refund claim is lodged in a different jurisdiction the same cannot be rejected only for want of right Jurisdiction. The only aspect has to be ensured that refund should not be claimed by more than one person which is not the case here. In the present case we are of the clear view that the respondent's Pune office has right to claim at Pune only, therefore, the claim is not without the Jurisdiction. It is also not the case of the Revenue that the same refund is either claimed by the respondent's Delhi office or by another person. Since the service tax was erroneously paid the same has to be refunded and M/s. IDSPL has given the disclaimer, only right to claim the refund is with respondent only.

Noting that the ratio of all the cited judgments are applicable to the present case and that the Commissioner (Appeals) had made a proper application of mind and given detailed findings in which no infirmity is found, the order was upheld and the Revenue appeal was dismissed.

(See 2015-TIOL-2646-CESTAT-MUM)