2020 (7) TMI 321 - HC - Service Tax

Court Upholds Assessee's Cenvat Credit Refund Without Premises Registration Requirement, Aligns with Precedents.

The Commissioner of GST & Central Excise, Chennai Versus M/s. Pay Pal India Pvt. Ltd.

The HC dismissed the Revenue's appeal against the Tribunal's decision favoring the Assessee's Cenvat credit refund claim under Rule 5 of CCR Rules, 2004. ... Refund of CENVAT credit - denial of credit on the ground that the premises in question from where the services in question were exported, were not registered with the Revenue Department - Rule 5 of CCR Rules, 2004 - HELD THAT:- In a recent decision in BNP Paribas Sundaram Global Securities Operations Pvt. Ltd, [2018 (6) TMI 676 - MADRAS HIGH COURT], the Hon'ble High Court of Madras, has interalia held that Rule 5 of CCR, 2004, does not stipulate registration of premises as a necessary pre-requisite for claiming a refund. The relevant rules, notifications and earlier judgments of the Coordinate Bench having been considered while allowing the appeal filed by the Assessee, the learned Tribunal held that refund claimed by the Assessee on Cenvat Credit cannot be disallowed merely because the premises in question was not registered with the Revenue Department. It is brought to our notice that the Assessee had applied for such registration and the same was granted by the Department on 1.6.2009 and the present controversy pertains to the period prior to 01.06.2009, the date of grant of registration. Appeal dismissed - decided against Revenue. Issues:Challenge to Tribunal's order denying refund of Cenvat credit due to lack of premises registration with Revenue Department.Analysis:The Revenue Department challenged the Tribunal's decision denying the Assessee's refund claim of Cenvat credit under Rule 5 of CCR Rules, 2004, citing lack of registration of premises with the Revenue Department. The Tribunal, following previous decisions of the Division Bench, ruled in favor of the Assessee, emphasizing that Rule 5 does not mandate premises registration for claiming a refund. The Tribunal dismissed the appeal, citing precedents like BNP Paribas Sundaram Global Securities Operations Pvt. Ltd and M/s. Scioninspire Consulting Services India Pvt. Ltd.The Revenue Department contended that it did not accept the earlier judgments but did not appeal to the Supreme Court due to low tax effect. Conversely, the Assessee's counsel supported the Tribunal's decision, asserting that consistency with prior Division Bench rulings warranted dismissal of the Revenue's appeal. The High Court, after hearing both parties and reviewing the Tribunal's order, found no merit in the Revenue's appeal, leading to its dismissal.The High Court considered relevant rules, notifications, and past judgments, concluding that the Assessee's refund claim could not be rejected solely based on lack of premises registration. The Court noted that the Assessee had applied for registration, which was granted post the period in question. The Court rebuffed the Revenue's argument against accepting prior Division Bench judgments, emphasizing the Department's obligation to adhere to such judgments unless overturned by higher courts or altered by subsequent legal amendments.Ultimately, the High Court rejected the Revenue's contentions, finding no legal question necessitating consideration in the appeal. Consequently, the Court dismissed the Revenue's appeal, with no costs imposed.