TaxTMI 
TaxTMI 
2025 (3) TMI 1065
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....ches. Appeal Nos. ST/86917, 87059/2016, ST/85170/2017, ST/85194, 86490, 87558/2018 shall be called hereinafter as Batch-I appeals which have a common issue involved which is related to refund of accumulated cenvat credit under the provisions of Rule 5 of Cenvat Credit Rules, 2004. Remaining appeals shall hereinafter be referred to as Batch-II appeals and are having an issue related to refund of service tax under Section 11B of Central Excise Act, 1944 made applicable to service tax matters through Section 83 of Finance Act, 1994. 2. Brief facts of the case are as follows:- Appellant provides information technology software services to its clients located outside India. Appellant provides the said services under two modules which shall be hereinafter referred to as Model-I and Model-II. The transactions that are under Model-I are not under dispute in the present appeals and, therefore, details of the same are not required because in the case of Model-I, appellant directly enters into contracts with overseas customers for providing information technology software service (ITSS). Appellant raises invoice on overseas customers for entire service rendered and the said transactions....
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....of service tax paid on services covered by Model-II transactions is Rs.75,26,04,317/-. In respect of Batch-I appeals, the original authority and the first appellate authority have held that service tax paid under reverse charge on services provided by subsidiaries to clients outside India will not qualify as input services for the appellant in India and, therefore, the refund of cenvat credit of Rs.75,26,04,317/- in six orders-in-appeal related to six appeals in Batch-I was denied to the appellant. Aggrieved by the said order, appellant is before this Tribunal in Batch-I appeals. In respect of Batch-II appeals, the original authority in all the six cases has rejected the refund applications. Learned Commissioner (Appeals) has affirmed the said orders by assigning various reasons like the application is premature or if such application is allowed, it will create legal implications. Aggrieved by the said orders, appellant is before this Tribunal in Batch-II appeals. 3. Hearing of these appeals took place on various dates and on various dates, part of the arguments were made by both sides. Therefore, both sides were allowed to make consolidated written submissions on the basis of t....
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....td. vs. Commissioner of Central Excise, Kolkata reported at 2019 (368) ELT 216 (SC) contended that refund claim filed by the appellant under Section 11B cannot survive, learned counsel has submitted that the Larger Bench in the case of Shree Balaji Warehouse vs. Commissioner of Central Excise & Service Tax, Panchkula reported at 2023 (9) TMI 1478 - CESTAT Chandigarh (LB) held that the decision in ITC Ltd. (supra) is not applicable to service tax matter since service tax return is not assessed by the proper officer unlike the Bill of Entry under the Customs Act, 1962. c. Dealing with the argument of Revenue that the Tribunal's final order No. A/85255-85262/2022 dated 04.03.2022 has decided that the Model-II onsite turnover does not qualify as export of services, learned counsel for the appellant has submitted that there is no discussion or finding about the denial of cenvat credit of tax paid on reverse charge. d. The calculation sheet submitted by Revenue has no bearing on the relief claimed by the appellant in the present appeals since the effect of transfer of cenvat credit to refund receivable general ledger is not considered by the department in the said compu....
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....216- 16-17 130,76,74,227 4 86599/201 7 Oct-15 to Mar- 16 PUN- SVTAX- 000-APP- 02-216- 17-18 354,74,52,739 ST/85170/ 2017 17,84,94,695 5 ST/85183/ 2018 Apr-16 to Sep- 16 PUN-CT- APPII- 000-226- 17-18 333,01,30,759 ST/85194/ 2018 15,22,18,357 Sub-total (A) 1498,20,95,367 49,62,27,076 6 ST/85194/ 2019 Oct 16 to Mar- 17 PUN-CT- APPII- 000-137- 18-19 398,09,73,699 ST/86490/ 2018 17,18,91,071 7 ST/88383/ 2018 Apr-17 to Jun 17 PUN-CT-APPII-000- 038-18-19 171,74,52,828 ST/87558/ 2018 8,44,86,170 Sub-total (B) 569,84,26,527 25,63,77,241 Total (A+B) 2068,05,21,894 75,26,04,317 5. Out of the total amount of disputed Cenvat Credit of Rs 75,26,04,317/- denied in the Batch 1 Appeals, the Appellant reversed the Cenvat credit to the extent of Rs 49,62,27,076/- (from October 2014 to September 2016) and transferred in a distinct ledger named 'Refund Receivable General GL-10300024 (Old Software GL-140910)' in ....
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....TION I, Heena Shah, the Deponent above named, do hereby verify that the contents of foregoing affidavit are true to my knowledge, derived from the records of the case and the submissions made therein are on advice received and believed by me to be correct, no part of it is false and nothing material has been concealed therefrom. Verified at Pune on the 26th day of June, 2024. DEPONENT" 5. Similarly Revenue has filed written submissions on various dates and submitted as follows. A. In respect of Batch-I appeals, Revenue has made following submissions:- a. Under Model-II, service cannot be treated as service exported for the purpose of calculating refund. b. Batch-I appeals are squarely covered by the final order bearing final order No. A/85255-85262/2022 dated 04.03.2022 of the Tribunal for the past period from July 2012 to March 2014, wherein it was categorically held that onsite component of Model-II service cannot be treated as export of service. It was held by this Tribunal that the appellant's claim that the component of onsite service actually provided by the subsidiary to the overseas client directly under a valid contract be....
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....cipients and provides service outside the territorial jurisdiction of India to their overseas customers and raises invoice from the subsidiary and collects the consideration for providing the service. As a transaction between the appellant company and subsidiary company or the appellant who is a holding company, invoices are raised between the two and money is transferred to the holding company irrespective of the value of service provided by subsidiary outside the territorial jurisdiction of India to overseas clients. The services provided by overseas subsidiary to their overseas clients are treated by the appellant as having provided by them on the strength of invoices which are for financial transactions between the holding company and subsidiary company where the appellant has no role in providing services by their subsidiary to their clients. Appellant has paid service tax on these transactions on reverse charge basis and availed cenvat credit of the same. Contention of Revenue is that those services are provided by subsidiaries and the appellant has nothing to do with them and, therefore, they are not input services for the appellant and, therefore, cenvat credit of service t....
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....it Rules, 2004 and, therefore, they were withdrawing their claim of refund to the tune of Rs.1992,79,17,577/-. Through the said affidavit, appellant has further submitted that they were pressing for refund of Rs.49,62,27,076/- out of Rs.75,26,04,317/- and also stated that Rs.25,63,77,247/- for the period from October 2016 to June 2017 has not been reversed/debited from cenvat credit ledger. The said claim for refund is in respect of service tax paid by the appellant in respect of transactions that took place beyond the territorial jurisdiction of India and, therefore, that service tax was not payable. We also note that out of the six refund applications, appellant is seeking refund of total amount of Rs.49.62 crores. We note that the refund claim in appeal No. ST/87575/2016 is Rs.542.85 crores. The same in appeal No. ST/87574/2016 is Rs.136.82 crores. Similarly the other refund claims in respect of other appeals are Rs.130.76 crores Rs.354.74 crores Rs.333.01 crores Rs.398.09 crores and Rs.171.74 crores. We note that out of, for example Rs.542.85 crores which component which is part of Rs.1992.79 crores and out of Rs.398.09 crores, which part of Rs.1992.79 crores and Rs.25.63 crore....