2011 (10) TMI 142 - AT - Central Excise

Manufacturer Granted Refunds on Service Tax for Various Services

SEMCO Electric Pvt. Ltd. Versus Commissioner of Central Excise Pune - I

SEMCO Electric Pvt. Ltd. Versus Commissioner of Central Excise Pune - I - 2013 (30) S.T.R. 572 (Tri. - Mumbai) Issues:Refund claims disallowed on service tax paid for various services - Catering, telephone, maintenance, clearing and forwarding, technical testing, management consultancy, and GTA services.Analysis:The appellant, a manufacturer under Chapter 84 and 85 of the Central Excise Tariff Act, filed refund claims for accumulated CENVAT credit on service tax paid for different services. The lower adjudicating authority and the Commissioner of Central Excise (Appeals) rejected the refund claims. The appellant appealed, citing previous Tribunal orders allowing similar refunds. The appellant argued for the refund of service tax paid on catering services, relying on the High Court's decision in Ultratech Cement's case, which permitted such refunds except for the portion borne by workers. The Tribunal agreed, allowing the refund for catering services.Regarding telephone services, the Tribunal referenced the Ultratech Cement case, allowing service tax credit on mobile phones for employees. The Tribunal held that refunds for service tax paid on mobile phones installed at employees' residences were eligible if borne by the appellant. For maintenance and repair services on office equipment in the factory, the Tribunal deemed them as 'input services' related to manufacturing and allowed the credit under CENVAT Credit Rules, 2004.The Tribunal also recognized clearing and forwarding agency services for exports as exempt from service tax, entitling the appellant to refunds if paid. Technical testing and analysis services for exported goods were considered essential input services for meeting quality parameters, making them eligible for refunds. Management consultancy services related to business activities, like foreign exchange risk management and unit mergers, were deemed eligible input services, warranting refunds.Regarding GTA services for importing inputs and capital goods, the Tribunal affirmed their status as 'input services' integral to manufacturing activities. Citing previous Tribunal orders, the Tribunal allowed the appeals, granting the appellant refunds on service tax paid for services utilized in manufacturing and exporting goods. Consequently, all three appeals were allowed with consequential reliefs, if any, in favor of the appellant.