Swachh Bharat Cess refund and Cenvat credit allowed where service tax refund machinery applied to the levy.

Swachh Bharat Cess paid on input services used for export services was treated as falling within the same refund and credit framework as service tax because section 119 of the Finance Act, 2015 applied Chapter V of the Finance Act, 1994 and the related rules to its levy and collection. On that basis, the cess was held refundable and available as Cenvat credit. A procedural lapse in filing the claim in two separate parts was held insufficient to deny the substantive benefit.

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Issues: Whether Swachh Bharat Cess paid on input services used for providing export services was eligible for refund and Cenvat credit.

Analysis: Section 119 of the Finance Act, 2015 made Swachh Bharat Cess leviable as service tax and specifically provided that the provisions of Chapter V of the Finance Act, 1994 and the rules made thereunder, including those relating to refunds and exemptions, would apply to its levy and collection. On that basis, the cess was treated as partaking of the same legal framework as service tax for credit and refund purposes. The Tribunal also held that the fact that the claim was filed in two separate parts was only a procedural lapse and could not defeat the substantive refund entitlement.

Conclusion: Swachh Bharat Cess paid on input services was refundable and available as Cenvat credit; the appeal succeeded.

Ratio Decidendi: Where a cess is made subject to the refund and credit machinery applicable to service tax, the assessee is entitled to refund and utilisation of credit in the same manner as service tax, and a mere procedural defect cannot deny the substantive benefit.

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