2026 (1) TMI 1346

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....Services Rules, 2005 and as per Rule 5 of CENVAT Credit Rule, 2005. 2. Appellant is engaged in export of back office services and obtained Service Tax Registration under the category of Business Auxiliary Service and Management Consultancy Service. Appellant had exported services and filed refund claim as per Rule 5 of CENVAT Credit Rule, 2005. The Appeal No. ST/20635/2022 pertains to period from April 2016 to June 2016 and Appeal No.ST/20602/2021 pertains to period from October 2014 to December 2014. Alleging various defects in the refund claim, show cause notice was issued and Adjudication Authority as per the Order-in-Original dated 13.01.2017 denied the refund on the ground that the Appellant has not availed any CENVAT Credit during ....

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....e Appellant had satisfied all the conditions stipulated under Rule 6A of the Service Tax Rules, 1994, complied the condition specified in Notification No. 27/2012-CE, verified the export turn over as claimed and held that Appellant is eligible for CENVAT credit of Rs. 54,73,173/- out of Rs. 54,84,975/- and held ineligible for CENVAT Credit of Rs.11,802/- against Hotel Inn Club and Guest House service and supply of Tangible goods. However by following the very same method of rejecting the refund in the first round of litigation which was held unsustainable by the first Appellate authority, Adjudication Authority rejected the claim on the ground that the claimant has not availed any CENVAT credit in their ST-3 return filed for the period Octo....

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....is not based on ST-3 returns and ST-3 return is nothing but a report of transactions that have taken place over a period covered by the returns. On the ground that the figures in ST-3 returns were not correct or there was a substantial difference, refund claim cannot be rejected. For the purpose of consideration of refund claim, the relevant documents on the basis of which credit was taken, nature of service and its nexus and utilization of the service for rendering output service are relevant and merely because there was some mistake in the ST-3 returns, substantive right of assessee for refund cannot be rejected. Therefore, I do not consider it necessary to consider the issue as to whether figures in ST-3 returns tallied with the amounts ....

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..... We find that merely if ST-3 returns does not tally with the amount claimed in the refund claim, is not a reason to reject the refund claim, since the refund claim is not based on the ST-3 returns. The purpose of considering the refund claim, the relevant documents on the basis of which credit was taken, nature of service and its nexus and utilization of the services for rendering output services are relevant. Moreover all these issues were considered in the first round of litigation by the Original Authority and considering the same, there is no reason or justification to deny the refund on procedural lapse. However, as regarding the denial of CENVAT Credit taken during the period from July 2012 to September 2012 of Rs.11,802/- against Ho....