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Serco Global Services Pvt Ltd Versus Commissioner of Central Excise, Delhi-III

2015 (6) TMI 270 - CESTAT NEW DELHI

Denial of refund claim - No unutilized CENVAT Credit - Export of software - STPI unit - Held that:- Refund is to be granted on the basis of the cenvat credit available in the Cenvat Credit Account and not on the basis of the closing balance of Cenvat credit shown in ST-3 Return. - even after adjusting the amount of refund of ₹ 56,58,994/- towards the cenvat credit amount of ₹ 68,27,559/-summarily held to be inadmissible, no action has been initiated for recovering the remaining amoun .....

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so as to correctly reflect the CENVAT availed utilized and carried forward in subsequent returns.

Adjudicating authority has come to a clear finding that for the quarters October 2008 to December 2008 and January 2009 to March 2009, ₹ 56,58,994/- is the amount of refund of unitilised Cenvat credit admissible to the appellant. As regard the refund for the quarter April 2008 to June 2008, in view of the fact that Cenvat credit account had balance and a revised ST-3 return was als .....

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-3-2015 - G Raghuram, President And R K Singh, Member (T),JJ. For the Appellant : Shri Nageshwar Rao, Adv. For the Respondent : Shri Govind Dixit, AR ORDER Per: R K Singh: This appeal has been filed against the Order-in-Appeal dated 29.3.2012 which upheld the Order-in-Original dated 1.7.2011 in terms of which 3 refund claims for the quarters April 2008 to June 2008, October 2008 to December, 2008 and January 2009 to March 2009 amounting to ₹ 18,58,858/-, ₹ 31,25,495/- and ₹ 25, .....

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ng authority came to a finding that- (i) while maintenance or repair of computer software under Annual Maintenance Contract or otherwise, was taxable under " Management, Maintenance or Repair" service under Section 65 (105) (zzg) of the Finance Act, 2004. "management , maintenance or repair" of software other than computer software were correctly classifiable under Information Technology Software services under Section 65 (105)(zzzze) which became taxable with effect from 16. .....

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nt contended that- (i) Its service was covered under the Management, Maintenance or Repair service during the whole period,(but during the hearing in CESTAT, it conceded that it was not pressing for the refund of amount of Cenvat credit taken before 16.5.2008). (ii) Merely because there was inadvertent mistake in ST-3 return in not showing correct closing balance of Cenvat Credit, that cannot be a ground for rejecting their claim for refund when Cenvat credit balance was available in their Cenva .....

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/- which remained as balance after adjusting the refund of ₹ 56,58,994/- although the primary adjudicating authority in para 16.5 of the adjudication order noted as under: "However, even after such deduction, an amount of ₹ 11,68,565/- is still payable by the applicant for which separate proceedings may be initiated by the Assistant Commissioner (Division - Gurgaon) as the same cannot be done in the present refund proceedings." 4. The ld. D.R. stated that the adjudicating a .....

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riod 16.5.2008 to June 2008 that the ST-3 return for June 2008 did not show any unutilized balance of Cenvat credit, it is to be made clear that refund is to be granted on the basis of the cenvat credit available in the Cenvat Credit Account and not on the basis of the closing balance of Cenvat credit shown in ST-3 Return. Further the appellant submitted revised return showing correct closing balance of Cenvat credit but the same was ignored by the adjudicating authority. In this regard, we find .....

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imply on the ground that the same has been filed after a period provided under Rule 7B of the Rules. In these circumstances, we find that the matter requires re-consideration by the adjudicating authority in view of the provision of Rule 7C of the Rules. The impugned order is set aside, after waiving pre-deposit of the amount of service tax, interest and penalty and the matter is remanded to the adjudicating authority to decide the issue afresh after offering an opportunity of hearing to the app .....

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, it has obviously not been done. Indeed, we find that even after adjusting the amount of refund of ₹ 56,58,994/- towards the cenvat credit amount of ₹ 68,27,559/-summarily held to be inadmissible, no action has been initiated for recovering the remaining amount of ₹ 11,68,565/-as noted earlier. It has been held in the case of Hindustan Zinc Ltd. vs. C.C.E., Jaipur II - 2009 (15) STR 633 (Tri-Del.) that adjustment of refund claim in another pending case is not sustainable. In t .....

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r (in para 6) has noted as under: 6. I find that the appellant had not shown all eligible input credits in the service tax return for the period April 2008 to September 2008. However, the appellant has shown all the past eligible credits not shown in earlier returns in the opening balance in the service tax return for the period October March 2009. Also the appellant was maintaining the Cenvat Credit register during the period April - September 2008. In view of the said inadvertent errors, the a .....

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vat credit to be ₹ 68,27,559/- as on September 2008 and that the appellant was maintaining the Cenvat Credit register. 7. We find that the primary adjudicating authority in para 16.2 to 16.4 has noted as under: 16.2 October 2008- December 2008: (Amount in Rs.) Total Export Turnover 5,39,02,785 Total Domestic Turnover 84,23,580 Total turnover 6,23,26,365 CENVAT credit availed 36,13,927 CEVAT credit disallowed (-) 19,316 CENVAT credit allowed 35,94,611 CENVAT credit utilized 3,53,996 Unutili .....

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41 16.4 In view of the above findings, it is held that a total amount of ₹ 56,58,994/- (rupees fifty six lacs fifty eight thousand nine hundred ninety four only) is the amount of refund of untilised CENVAT Credit admissible to M/s Serco Global Services Private Limited for the quarters April 2008 to June 2008, October 2008 to December 2008 & January 2009 to March 2009. However, an amount of ₹ 68,27,559/- which has been wrongly added by them to their Cenvat credit account is ordere .....

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