2019 (3) TMI 1438 - AT - Service Tax

Tribunal allows export service claim, rejects jurisdictional challenge, remands for refund processing

The appeals were allowed as the Tribunal found the appellant's service qualified as export under Service Tax Rules. The rejection based on jurisdictional ... 100% EOU - Refund claim - export of services - SCN was issued only on the ground of non-submission of certain documents whereas the impugned order has been passed on the ground that the appellant has not registered in Bangalore for its Pune and Hyderabad Units - Scope of SCN - Held that:- The appellant filed refund claim pertaining to accumulated unutilized CENVAT credit which was initially objected to by the department for non-submission of certain documents. Finally, Asst. Commissioner rejected the said refund against which the appellant filed appeal before the Commissioner (A) who allowed the appeal and remanded the matter back to the original authority and the original authority in de novo proceedings has partially allowed the refund claim and partially rejected the refund only on the ground that the appellant’s two units situated at Hyderabad and Pune are not registered in Bangalore, therefore, refund claim filed in Bangalore is not maintainable on account of jurisdiction. Further, after the centralized registration, any refund claim pertaining to the appellant will lie only in Bangalore because all the records are available at Bangalore and there is a centralized accounting system being followed at Bangalore. There is no force in the contention of the learned AR saying that the records pertaining to Pune and Hyderabad are available with the said jurisdictional authorities alone, because the appellant along with refund application has filed all the documents in support of the refund claim but both the authorities without examining the record have rejected the refund claim merely on the ground of territorial jurisdiction, which according to me is not tenable under law; that too once the appellant has obtained centralized registration and has filed the refund claim after obtaining the centralized registration. The grounds on which refund has been rejected is not sustainable in law - case remanded to the original authority for examination and verification of the documents pertaining to refund and thereafter, grant refund in accordance with law - appeal allowed by way of remand. Issues:Appeal against rejection of refund claims by Commissioner (A) - Jurisdictional concerns regarding registration of units in different locations - Compliance with procedural conditions for refund claims.Analysis:The judgment involves two appeals challenging the rejection of refund claims by the Commissioner (A). The appellant, a software export-oriented unit, filed refund claims for service tax paid during specific periods. The original authority partially sanctioned and rejected the claims. The Commissioner (A) initially allowed the appeal, leading to a de novo adjudication where part of the refund was disallowed due to jurisdictional issues regarding the appellant's units in Hyderabad and Pune not being registered in Bangalore. The appellant contended that the rejection went beyond the show-cause notice, citing relevant legal precedents.The appellant, represented by a consultant, argued that being a 100% EOU engaged in service exports, registration was not mandatory for refund eligibility, emphasizing the centralized registration obtained in Bangalore. The consultant referenced legal decisions supporting refund entitlement despite registration issues. The appellant had informed authorities about centralized accounting and registration transfer, maintaining that all claims should fall under Bangalore's jurisdiction post-centralized registration.The respondent defended the rejection, citing non-compliance with registration conditions specified in relevant notifications. Legal precedents were invoked to stress strict interpretation of such conditions. The Tribunal, after considering arguments from both parties and examining the case records, found the appellant's service qualified as export under Service Tax Rules. The rejection based on jurisdictional grounds was deemed untenable, given the centralized registration and proper documentation submitted. Consequently, the impugned order was set aside, and the case remanded for further verification and refund processing in accordance with the law. Both appeals were allowed through remand, emphasizing the importance of procedural compliance and jurisdictional clarity in refund claims.In conclusion, the judgment addresses the complexities of jurisdictional issues in refund claims, emphasizing the significance of centralized registration and procedural adherence. The decision underscores the need for authorities to consider all relevant factors before rejecting refund claims solely based on jurisdictional technicalities, ensuring fair treatment for appellants in similar situations.