Refund of Cenvat credit on exported services upheld; new factual grounds could not be raised without a show cause notice.

Refund of Cenvat credit of service tax paid on input services used for exported output services was held admissible where the services were exported and credit had been availed for that purpose. The Tribunal also rejected the Revenue's attempt to raise a new factual ground at the appellate stage because no such allegation had been made in the show cause notice. As the impugned orders followed earlier Tribunal rulings and Board circulars, the refund in favour of the assessee was upheld and the Revenue's appeals were dismissed.

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Issues: Whether refund of Cenvat credit of service tax availed on input services used for providing exported output services was admissible, and whether the Revenue could succeed by raising a new ground without any show cause notice on that basis.

Analysis: The respondents had exported services to recipients abroad and had availed credit of service tax paid on input services used for rendering those services. The appellate authority had granted refund following earlier Tribunal decisions on the same issue and the Board circulars. The Tribunal found no dispute as to export of services or availing of credit, and held that the Revenue's attempt to introduce an altogether new factual ground at the appellate stage could not be entertained when no such allegation had been raised in the show cause notice. The impugned orders were consistent with earlier Tribunal rulings and required no interference.

Conclusion: The refund was upheld in favour of the respondents and the Revenue's appeals were rejected.

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