2018 (10) TMI 1555 - AT - Service Tax

Appellate tribunal grants rebate for exported BPO services, stresses compliance with Notification No.11/2005

M/s. Conduent Business India LLP (Formerly known as M/s. Affiliated Computer Services (I) Pvt. Ltd., M/s. Xerox Business Services India LLP, M/s. Xerox Business Services India Pvt. Ltd.) Versus The Commissioner of Central Excise & Service Tax

The appellate tribunal allowed all appeals challenging the rejection of rebate claims by the department for service tax on exported BPO services. The ... Rebate of service tax paid - appellants have vehemently claimed that they are engaged in export of BPO services and have filed rebate claims in terms of Notification No.11/2005-ST - Held that:- What is required to be verified while sanctioning rebate claim under the said Notification is whether service has been exported or not and whether consideration has been received by the exported service and whether the tax has been paid on the service exported or not. Other than this, no other verification is required. Tribunal has followed the decision in the case of Cochin Branch of appellant’s themselves. In view of the above, all other considerations and discussions made in the OIOs/OIAs are not acceptable. The authorities are required to verify the requirements in terms of Notification No.11/2005-ST as cited above. Appellants have claimed that they have submitted the records, documents, certificate to that effect. In view of the same, it will be in the interest of justice that the matter should go back to the original authority for proper appreciation of the evidence submitted by the appellants and the case law cited. Appeal allowed by way pf remand. Issues involved:1. Rejection of rebate claims by the department based on various grounds.2. Irregular availment of credit leading to show-cause notices.3. Appeals filed against the confirmed show-cause notices and upheld OIOs.4. Interpretation of Notification No.11/2005 for rebate claims on exported services.5. Verification requirements for sanctioning rebate claims under Notification No.11/2005.6. Consideration of evidence and submissions by the original authority for proper appreciation.Detailed Analysis:1. The department issued show-cause notices to reject rebate claims by the appellant concerning service tax paid on exported BPO services. The grounds for rejection included issues with input service invoices, proof of payment, export invoice correlation, and the taxable status of certain services until a specific date. The Commissioner (A) confirmed the show-cause notices, leading to the filing of appeals by the appellants against the decisions.2. The department also raised concerns about the irregular availment of credit, which resulted in the show-cause notices. The OIOs were upheld by the Commissioner (A), prompting the appellants to challenge these decisions through appeals.3. The appellants argued that they met the conditions of Notification No.11/2005 for rebate claims by submitting necessary documents related to the export of services and payment of service tax. They specifically claimed rebate only on BPO services, despite being eligible for other services as per judicial pronouncements. The authorities rejected their claims based on the grounds mentioned earlier.4. The appellate tribunal reviewed the submissions and documents provided by the appellants. They emphasized the importance of verifying whether the service was exported, consideration was received, and tax was paid on the exported service as per Notification No.11/2005. The tribunal referred to a previous decision regarding the correctness of CENVAT credit availed not being necessary for rebate claims under the said Notification.5. The tribunal found that the authorities should focus on verifying the specific requirements of Notification No.11/2005 for sanctioning rebate claims, rather than other considerations mentioned in the OIOs/OIAs. The appellants had submitted records, documents, and certificates supporting their claims, which necessitated a proper appreciation of the evidence by the original authority.6. Consequently, the tribunal allowed all the appeals by remanding the matter back to the original authority for a thorough review of the evidence and submissions provided by the appellants. The original authority was directed to decide on the applications within three months and requested the appellants to make fresh submissions with the required proof as per Notification No.11/2005.