2019 (3) TMI 1327 - AT - Service Tax

Tribunal Clarifies Remand Order on Refund Claim Limits and Nexus Declaration Requirement

The Tribunal clarified that the remand order regarding the refund claim rejection was limited to a specific amount, resolving ambiguity in the final ... Rectification of Mistake - Refund claim - rejection of refund claim on the ground of lack of nexus between input services and output services - Held that:- The Tribunal had upheld the remand order passed by the Commissioner (Appeals), had not specifically clarified as to what is the amount that is sought to be remanded for reconsideration of the issue of lack of nexus. We find that this it is necessary to clarify for facilitating the process of refund claim. It is hereby clarified that the remand order with regard to eligibility of credit on account of lack of nexus between the input services and the output service would be limited to ₹ 7,27,697/-. However, it is clarified that the issue with regard to reconciliation as remanded by the Commissioner (Appeals) would apply to the entire refund claim. The ROM applications are disposed of by way of clarification. Issues Involved:Rectification of mistake in the impugned final order regarding the refund claim and the requirement of filing a declaration as per Circular dated 19.1.2010 for establishing nexus between input and output services.Analysis:1. Rectification of Mistake in the Final Order:The appellant filed ROM applications seeking rectification of a mistake in the final order passed by the Tribunal. The appellant's counsel argued that while the Tribunal upheld the remand order by the Commissioner (Appeals) regarding the refund claim rejection, there was ambiguity in para 8.1 of the order. The issue was whether the remand order pertained only to a specific amount of &8377; 7,27,697 or the entire refund claim. The appellant requested clarification on this point.2. Requirement of Filing Declaration for Nexus:The respondent, represented by the ld. AR, contended that as per the Circular dated 19.1.2010, the appellant was obligated to file a declaration to establish the nexus between input and output services. The respondent argued that such a declaration would clarify the link between the services and facilitate the refund claim process.3. Tribunal's Clarification:After hearing both parties, the Tribunal examined the impugned order and the show cause notice. It was noted that the proposal for rejecting the refund claim due to a lack of nexus between input and output services was only for the amount of &8377; 7,27,697. However, the Tribunal's order lacked specificity on the amount to be remanded for reconsideration regarding the nexus issue. To facilitate the refund claim process, the Tribunal clarified that the remand order concerning the eligibility of credit due to the lack of nexus would be limited to the aforementioned amount. Additionally, the issue of reconciliation, as remanded by the Commissioner (Appeals), would apply to the entire refund claim. The ROM applications were disposed of through this clarification.In conclusion, the Tribunal provided the necessary clarification on the scope of the remand order and the requirement of filing a declaration to establish the nexus between input and output services, ensuring a clear understanding of the issues involved in the refund claim process.