2013 (9) TMI 145 - AT - Service Tax

Tribunal Grants Refunds under CENVAT Credit Rules

M/s. JJ. SPECTRUM SLIK AND M/s. JJ. EXPORTS LTD. Versus COMMISSIONER OF CENTRAL EXCISE, KOLKATA-VII

The Tribunal allowed certain refund claims under Rule 5 of CENVAT Credit Rules, 2004, based on retrospective amendments and relevant circular ... Refund claim under Rule 5 of CENVAT Credit Rules, 2004 read with Notification No.5/2005-CE dated 14.03.2006 - Denied refund of the credit under Rule 5 of the CENVAT Credit Rules to the Appellant on the ground that service tax paid under Section 66A(1) of the Finance Act, 1994 was not listed under Rule 3(1) of the CENVAT Credit Rules and hence, no CENVAT Credit could be allowed on the said amount of service tax paid and accordingly, no refund was admissible under Rule 5 of the CENVAT Credit Rules – Held that:- The payment of service tax under Section 66A(1) had been subsequently inserted as clause (ixa) in Rule 3(1) of the CENVAT Credit Rules, 2004 by amending the said Rule and giving retrospective effect to the said amendment from 18.04.2006. Hence, the refund of CENVAT Credit on the said input service is admissible under Rule 5 of the CENVAT Credit Rules. Accordingly, the Appeal is allowed to this extent. Regarding Appeal No.E/A/295/11, amount of refund claim was rejected on the ground that the said amount pertained to the earlier quarter and hence, cannot be admissible as refund for the quarter in which the goods were exported – Held that:- Central Government’s Circular No.120/01/2010-ST dated 19.01.2010 issued from F.No.345/268/2009-TRU by the Government of India, Ministry of Finance, Department of Revenue (Tax Research Unit), is very clear in this respect. Hence, the refund claim is admissible to the Appellant. Accordingly, the Appeal is allowed to that extent. Regarding few other amount, ld – Held that:- Chartered Accountant has conceded that the respective bills do not relate to the Appellant and hence, refund of the same not admissible to them. Regarding rest of the amount – Held that:- Both sides agreed that the same are required to be examined and verified afresh, by the Adjudicating Authority and the matter should be remitted to the Adjudicating Authority for a fresh decision. Issues:1. Denial of refund claim under Rule 5 of CENVAT Credit Rules, 2004.2. Admissibility of service tax paid under Section 66A of the Finance Act, 1994.3. Rejection of refund claims on various grounds.4. Interpretation of Circular No.120/01/2010-ST regarding credit admissibility.5. Examination and verification of refund claims by the Adjudicating Authority.Analysis:- Issue 1: Denial of refund claim under Rule 5 of CENVAT Credit Rules, 2004In both appeals, the Appellants filed refund claims under Rule 5 of CENVAT Credit Rules, 2004, which were initially denied by the Adjudicating Authority. However, the Tribunal allowed the refund claims after considering relevant amendments and retrospective effects, thereby granting relief to the Appellants.- Issue 2: Admissibility of service tax paid under Section 66A of the Finance Act, 1994The Adjudicating Authority initially denied refund claims based on service tax paid under Section 66A of the Finance Act, 1994, citing non-admissibility under Rule 3(1) of the CENVAT Credit Rules, 2004. The Tribunal, after considering subsequent amendments and retrospective effects, allowed the refund claims related to such service tax payments.- Issue 3: Rejection of refund claims on various groundsVarious refund claims were rejected on grounds such as non-mentioning of service tax registration number, invoices addressed to head office, and lack of nexus with manufacturing activities. The Tribunal directed a fresh examination of these claims by the Adjudicating Authority to verify their admissibility based on relevant documents and case laws.- Issue 4: Interpretation of Circular No.120/01/2010-ST regarding credit admissibilityThe Tribunal considered Circular No.120/01/2010-ST issued by the Government of India, Ministry of Finance, Department of Revenue, which clarified the admissibility of credits taken in earlier quarters for subsequent refund claims. The Tribunal upheld the Circular's interpretation and allowed refund claims based on the Circular's guidelines.- Issue 5: Examination and verification of refund claims by the Adjudicating AuthorityThe Tribunal remanded the case to the Adjudicating Authority for a fresh examination and verification of certain refund claims that were previously denied. This remand was based on the need to reevaluate the claims in light of the Tribunal's findings and relevant legal provisions.In conclusion, the Tribunal allowed certain refund claims under Rule 5 of CENVAT Credit Rules, 2004, based on retrospective amendments and relevant circular interpretations. It directed a reexamination of other denied claims by the Adjudicating Authority to ensure proper verification and adherence to legal requirements.