Refund of CENVAT credit for manufacturing and export allowed, Revenue's appeals dismissed. The Judicial Member upheld the Commissioner (A) order allowing the refund of CENVAT credit for services utilized in manufacturing and exporting goods, ...
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Refund of CENVAT credit for manufacturing and export allowed, Revenue's appeals dismissed.
The Judicial Member upheld the Commissioner (A) order allowing the refund of CENVAT credit for services utilized in manufacturing and exporting goods, dismissing Revenue's appeals. The Judicial Member found the disputed services qualified as input services, in line with precedents, and cited Rule 5 of CENVAT Credit Rules, 2004. The decision was pronounced on 23/06/2017.
Issues: Appeals filed by Revenue against Commissioner (A) order allowing refund of CENVAT credit on various services utilized for manufacture and export of goods.
Analysis: The case involved eight appeals filed by the Revenue against the Commissioner (A) order dated 30.7.2010 disposing of seven appeals and another order dated 28.8.2010 disposing of two appeals. The respondent-assessee, a 100% EOU engaged in manufacturing and exporting readymade garments, filed applications for refund of CENVAT credit under Rule 5 of CENVAT Credit Rules, 2004 for services like bank charges, technical testing charges, freight charges, telephone and internet charges, etc. The Assistant Commissioner allowed the refund, leading to the Revenue filing appeals on the grounds that the services claimed as credit were not utilized in manufacturing goods for export. The Commissioner (A) upheld the original order, prompting the Revenue to file the present appeals.
Both parties presented their arguments, with the appellant's AR contending that the services do not qualify as input services under Rule 2(l) of CCR, 2004, and the Commissioner (A) failed to appreciate Rule 5 of CCR along with Notification No.5/2006. On the other hand, the respondent's counsel defended the order, asserting that the services in question fell within the definition of input services and were utilized in connection with the business. The counsel cited precedents supporting the classification of these services as input services.
After considering the submissions and cited judgments, the Judicial Member found no fault in the Commissioner (A) order allowing the refund of CENVAT credit for the disputed services. Citing the precedent where similar services were considered input services, the Judicial Member upheld the impugned orders and dismissed the Revenue's appeals. The decision was pronounced in Open Court on 23/06/2017.
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