ST - Assessee, an exporter of BAS - Internet Telecom Services, Market Research services, Videotape production & Security services are in relation to business activity and, therefore, Input services - Refund admissible u/r 5 of CCR, 2004: CESTAT
By TIOL News Service
MUMBAI, MAY 30, 2016: APPEALS have been filed by Revenue against the orders passed by Commissioner (A), Mumbai. The respondent-assessee has also filed cross objections in respect of appeals filed by the Revenue.
The respondent is an exporter of services under the category of "Business Auxiliary Services". They were availing the CENVAT credit of Service Tax paid on various input services used by them for providing such output services & filed various refund claims as per provision of Rule 5 of the CCR, 2004 in respect of the accumulated CENVAT credit.
The adjudicating authority allowed part of the refund claimed. The lower appellate authority allowed the appeals filed by the respondent/assessee and directed the adjudicating authority to grant refund based upon the finding in the impugned order. In the said order the Commissioner (A) disallowed the refund claim wherein input service invoice were not available and which portion of the order is not appealed by the assessee.
As mentioned, Revenue is in appeal.
The details of the credit availed on various services which the assessee claims are ‘input services' and which have been allowed by Commissioner (A) are as tabulated below -
|
Category
|
Usage
|
Service Tax including Cess
|
|
Advertising Agency's Services
|
Issuing Recruitment Advertisements in Newspaper & On internet
|
36,050
|
|
Air Travel Agent
|
Visa/Ticket charges
|
2,53,422
|
|
Banking & other financial services
|
Processing of the payments, collecting export receivable
|
39,650
|
|
Business Auxiliary Services
|
Support services availed
|
2,39,287
|
|
Business support services
|
Support services for documentation
|
13,30,075
|
|
Providing food coupons to employees
|
78
|
|
Cargo Handling Service
|
Handling of imported goods
|
1,05,602
|
|
Chartered Accountant Services
|
Compliance with various statutes
|
1,12,064
|
|
Cleaning Services
|
Cleaning of office premise
|
11,79,311
|
|
Clearing & Forwarding Agent's Services
|
Clearing of imported goods
|
64,601
|
|
Construction of Commercial or Industrial Building
|
Repairs of building premises outside the office
|
16,027
|
|
Commercial Training & Coaching Services
|
Providing training for employees
|
1,74,352
|
|
Construction of Complex Service
|
Repair of the internal office premises
|
61,009
|
|
Courier Services
|
For sending essential documents for export
|
3,82,426
|
| |
Domestic Courier Services
|
1,17,872
|
|
Custom House Agent
|
Clearing imported goods
|
13,818
|
|
Erection, Commission & Installation
|
Erection, Commissioning or installation of any equipment or structure, installation of any electrical and electronic devices, Air condition ventilation, fire proofing, water proofing etc.
|
2,38,617
|
|
Event Management Services
|
For entertainment of employees
|
89,915
|
|
Excise
|
Excise duty paid
|
7,891
|
|
General Insurance Services
|
Maintenance/Insurance of Asset & premises
|
89,162
|
|
For staff insurance
|
24,87,851
|
|
Information Technology Software Services
|
Representation of instructions, data sound or image of a computer or an automatic data processing machine or any other device or equipment
|
9,98,922/-
|
|
Insurance Auxiliary Services
|
Maintenance/insurance of asset & premises
|
9,497
|
|
Interior Decorators Services
|
Consultancy or Technical Assistance relation to planning, designing of spaces etc
|
5,134
|
|
Internet Telecommunication Services
|
Internet/Telephone purpose
|
72,209
|
|
Management or Business Consultants Services
|
Consultancy with respect to business operation
|
12,54,242
|
|
Maintenance or Repair Services
|
Repairs of building premises outside the office
|
48,24,839
|
|
Mandap Keeper
|
Temporary occupation of a mandap for organizing official function, business promotion and planning function etc.
|
24,642
|
|
Manpower Recruitment and Supply Agency
|
Recruitment of employees for business purposes
|
24,57,133
|
|
Market Research
|
For finding out market tends
|
50,213
|
|
Online Information & Database Access, Leased Services
|
For communicating with their customers, employees, service providers etc.
|
1,07,986
|
|
Outdoor Catering Services
|
For lunch/dinner of the staff on 24X7 basis
|
4,17,112
|
|
Real Estate Agency
|
To arrange for new office premises at Nasik & Pune
|
14,294
|
|
Renting of Immovable Property
|
Hired premises for providing medical transcription service
|
45,10,930
|
|
Security/Detectives Services
|
Security to office premises
|
15,24,580
|
|
Storage and warehousing
|
For storage of old documents
|
3,087
|
|
Technical Inspection & Certification Services
|
Consultancy with respect to business operation
|
1,74,322
|
|
Telecommunication Services
|
Internet/Telephone purpose
|
28,42,967
|
|
Tour Operator's Service
|
Pickup of employees from resident and client place
|
31,01,308
|
|
Transport of Goods by Road
|
Use for shifting of household articles of staff
|
894
|
|
Video Tape Production
|
Video shoot for business meeting and interview
|
16,609
|
|
Total
|
|
2,85,99,994
|
The Bench observed -
"It can be seen from the above reproduced category of input services, these services are in relation to the business activity undertaken by the respondent-assessee which cannot be disputed, as casual perusal of the services on which CENVAT credit was availed and for the purpose of which have been utilised as mentioned in the Order-in-Original would clearly indicate that these services were in relation to the business activity of the respondent-assessee. In our view, the first appellate authority has come to a correct conclusion that respondent-assessee is eligible to CENVAT credit and claim of the refund claim needs to be allowed. The claim of Revenue that input services do not have direct nexus to the business activity of respondent-assessee is a hollow claim…."
Holding that the view of the High Court in Ultratech Cement Ltd . 2010-TIOL-745-HC-MUM-ST squarely covers the ‘input services' used by the assessee, the Revenue appeals were rejected. The cross objections were disposed of.
(See 2016-TIOL-1275-CESTAT-MUM)
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