TMI Blog2023 (3) TMI 238X X X X Extracts X X X X X X X X Extracts X X X X ..... led towards discharge of duty or tax liability. Though referred to as refund, it is also not refund in the true sense that the claimant is not person liable to pay tax or duty having had to pay such duty or tax despite lack of authority of law; the discharge of tax liability by the provider of service, and in accordance with authority of law, is not in question at all. The intent is to neutralize the taxes included, thereby, in the value of goods manufactured or service so that taxes are not exported too. The limited remit of the sanctioning authority, subject to procedural prescription separately notified, is spelt out in the rule itself to limit denial, if any, only to such contingencies and disallowance, if at all, is restricted to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and solely in discharge of that responsibility, to scrutinize eligibility for, not refund but, threshold entitlement to credit under rule 3 of CENVAT Credit Rules, 2004. The appellant had sought sanction of ₹1,54,78,789 claimed to be credit availed on procurement of taxable services and/or dutiable goods deployed in the rendering of services outside the country between April 2016 and June 2016 that, in accordance with the statutory mechanism for neutralization of imposts in the value of exported services or goods, were to be reimbursed to the exporter. The original authority disallowed refund to the extent of ₹ 15,68,353 that, carried in appeal, did not find favour with Commissioner of CGST CX (Appeals-II), Mumbai and that ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ties relating to business, such as accounting, such as auditing, financing, recruitment and quality control, coaching and training, computer networking, credit rating, share registry, and security, inward transportation of inputs or capital goods and outward transportation upto the place of removal; (emphasize supplied) in rule 2 of CENVAT Credit Rules, 2004 and distinguishment of it as prevailing before, and from, 1st April 2004, after deletion of activities related to business and such as , held that the enumeration in the inclusive limb therein, while admittedly not exhaustive, could not be stretched beyond logical reason to cover all, and every, service even if not contributing to the manufacture of goods or rendering of service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not for personal use. Though the proximate consequence was denial of refund to the extent of ₹ 15,68,353, the real impact is deprivation of credit to that extent for, in terms of rule 5 of CENVAT Credit Rules, 2004, credit of ₹ 1,54,78,789 had been reversed before the claim was filed but only ₹ 1,39,10,525 has been monetized with no order for restoration of the rest in the account. Hence, in the formulation of issue for resolution supra on the deprivation being legal and proper, in addition to evaluation of submission by Learned Counsel and Learned Authorized Representative, reference may be had to the scheme and the refund mechanism gainfully. 3. The original authority and first appellate authority are in concurren ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... EME COURT], the intrinsic necessity of such secondment to the output/output service is undeniable. 4. It is from rule 3 of CENVAT Credit Rules, 2004, subject to rule 4 therein, that a central excise or service tax assessee gets to appropriate credit of tax charged on procurement of goods and services which is reported to the jurisdictional authorities in the prescribed returns who are, then, enabled to recover credit that, according to them, is not within entitlement under the authority of rule 14 of CENVAT Credit Rules, 2004. One of the determinants of entitlement is utilization of procured goods or services in the manufacture of dutiable goods or rendering of taxable services and it may not always be possible for manufacturers and serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in exports that has prompted this attractive neutralization scheme but the restricted scope for utilization of credit legitimately availed towards discharge of duty or tax liability. Though referred to as refund, it is also not refund in the true sense that the claimant is not person liable to pay tax or duty having had to pay such duty or tax despite lack of authority of law; the discharge of tax liability by the provider of service, and in accordance with authority of law, is not in question at all. The intent is to neutralize the taxes included, thereby, in the value of goods manufactured or service so that taxes are not exported too. The limited remit of the sanctioning authority, subject to procedural prescription separately notified ..... X X X X Extracts X X X X X X X X Extracts X X X X
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