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of <h1>Appeals remanded for refund denial on input services due to legal flaws, appellants' evidence considered.</h1> <h3>IBS Software Services Pvt. Ltd. Versus Commissioner of Central Excise, Customs And Service TAX, Kerala</h3> IBS Software Services Pvt. Ltd. Versus Commissioner of Central Excise, Customs And Service TAX, Kerala - TMI Issues:Refund of cenvat credit on input services denied on grounds of non-submission of invoices and challans, denial based on technicalities, rejection of refund due to invoices not complying with Rule 4A of Service Tax Rules.Analysis:The appellants, engaged in software services, filed three appeals against the Commissioner's order partially allowing and rejecting their refund claims. The appeals involved identical issues, leading to a common order. The appellants primarily export software services under taxable categories, utilizing input services on which they paid service tax. They filed refund claims under Cenvat Credit Rules, facing show-cause notices proposing denial based on various grounds. The Deputy Commissioner's Order-in-Original partially rejected the refund claim, leading to appeals before the Commissioner. The Commissioner partially allowed and rejected the refund, citing reasons like missing invoices and non-compliance with Rule 4A of Service Tax Rules.During the hearing, the appellants argued that the orders lacked legal sustainability, being based on assumptions and ignoring facts. They contended that they submitted all required invoices and challans, with the denial based on technicalities. They emphasized that beneficial legislation like Cenvat Credit Rules should be construed liberally. They cited legal precedents supporting their arguments and highlighted that substantive rights cannot be taken away due to procedural lapses, relying on relevant case laws.The appellants further argued that denial based on non-compliance with Rule 4A of Service Tax Rules was unjustified. They asserted that although some invoices lacked specific details, they contained sufficient information to prove input service receipt and utilization. They referenced legal cases where denial of cenvat credit based on missing registration numbers on invoices was rejected, emphasizing the importance of actual service tax payment and utilization over technicalities.On the contrary, the Authorized Representative reiterated the findings of the impugned order, supporting the denial of the refund claim. However, after considering both parties' submissions and reviewing the records, the Judicial Member found the impugned order legally unsustainable. The Member noted that the appellants had indeed submitted invoices and challans, which were not adequately considered by the lower authorities. Additionally, the rejection based on missing service provider registration numbers was deemed a technical lapse, with other particulars sufficiently proving input service receipt and utilization.Consequently, the Judicial Member decided to remand the appeals back to the original authority for reevaluation. The authority was directed to consider the documents provided by the appellants, adhere to higher judicial forum decisions on the matter, and decide on the refund claim within three months. The appellants were granted an opportunity to present necessary documents during the reevaluation process.
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