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M/s HCL Technologies Ltd. Versus Commissioner of Customs And Central Excise And Service Tax, Noida

2015 (9) TMI 1037 - CESTAT NEW DELHI

Availment of CENVAT Credit - disallowance of refund claim - export of BAS service - nexus of input service with output service - Rent-a-Cab Services, Courier Services, Management, Maintenance & Repair Service, Manpower Recruitment Service, Security Services, Cleaning Services, BSS Services (Summit), Legal Consultancy Services, Chartered Accountancy Services, Telecommunication Services and Renting of immovable property - Held that:- The credit of service tax on Courier Service has been denied for .....

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ich was affirmed in Commissioner Vs. Apar Industries - [2013 (2) TMI 276 - GUJARAT HIGH COURT].

Merely because the courier service was utilized within the country it cannot be assumed that the services does not have nexus with output services. - Further there is no dispute that these input services were received by the appellant. I hold that the appellants are eligible for refund of ₹ 6,670/- towards service tax paid on courier services.

According to appellants Manag .....

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nistrative and support staff which is required for carrying out its' day to day business activities. Therefore I find that the denial of refund on Manpower Recruitment Service, is unjustified. The same has to be allowed.

The security service was used to provide safety to employees. The Commissioner (Appeals) has rejected the claim holding that the invoices show security guard for pickup and drop of employees and has no nexus with output service. Appellants are entitled to credit/refun .....

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were conducted in which helped them improve their cliental. That such Summits helps the Company to meet potential clients and promote its' business and gain knowledge. I cannot differ with the submissions made by the learned advocate for the appellants as such summits do help the Company to promote and develop its' business. The credit and refund denied on these services in my view, is unjustified. The same is allowed.

The rejection of claim on the ground that filing of appeal or repl .....

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d on account of procedural lapse when substantive entitlement itself is not disputed. Further, the proviso to sub clause (2) of Rule 9 of Cenvat Credit Rules, provide that if documents do not contain full particulars the DC/AC has powers to condone the defects after satisfying whether properly accounted. In view thereof, the rejection of claim for the defects alleged in invoices is incorrect. The claim of credit on disputed invoices for those services which are eligible as input services are all .....

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of Service Tax paid on input services used for exporting BAS Services. The appellants filed refund claim of ₹ 2,44,78,648/- for the period October 2010 to December 2010. A Show Cause Notice was issued proposing to disallow claim of ₹ 54,84,068/-. which finalized by the order passed confirming the disallowance of refund claim. Aggrieved the appellants approached the first appellate authority who allowed part of the claim and rejected the refund claim of ₹ 7,52,975/-. Hence this .....

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nied stating the reason that the same has no nexus with the provision of output services. It is seen observed by the authorities below that Rent-a-Cab and tour operator were used by a particular person/guest though on a regular basis and that vehicles are used in the night also. The learned counsel, Ms. Sukriti Das, appearing for the appellants explained that appellants are a BPO Company and these services are utilized for the purposes of transportation of its employees to and from the workplace .....

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No. 943/04/2011-CX dated 29.4.2011 has clarified that the credit on such services shall be available if its' provision had been completed before 1.4.2011. According to the appellants the credit was availed for the period October 2010 to December 2010. They also relied upon the judgments rendered in CCE, Bangalore Vs. Bell Ceramics - 2012 (25) STR 428 (Kar), CCE, Bangalore Vs. Stanzen Toyotetsu India (P) Ltd 2011 (23) STR 444 (Kar.) and KPMG Vs. CCE, New Delhi - 2014 (33) STR 96 (Tri.-DeL). T .....

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work in shifts even during night hours, I cannot agree with the view of the authorities below that the such services have no nexus with the output services provided. The refund on these services is allowed. 5. The credit of service tax on Courier Service has been denied for the reason that these were used for dispatch within India where as appellant is engaged in export of services. That therefore these services has no nexus with the output services. The appellants submitted that courier servic .....

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er Vs. Apar Industries - 2011 (23) S.T.R. J194 (Guj.). The learned DR defended the impugned order stating that the services being used within the country are not available for credit as the appellants are engaged in export of services. To carry out the domain activity of exports, the appellants may require to send documents and such other to Offices, units within the country. Merely because the courier service was utilized within the country it cannot be assumed that the services does not have n .....

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ot have nexus with the provision of output service. In CCE & ST Vs. Lupin Ltd. 2012 (28) S.T.R. 291 (Tri.-Mum.), L'Oreal India Pvt. Ltd. Vs. CCE, Pune-I - 2011 (22) S.T.R. 89 (Tri.) and Delta Energy Systems Pvt. Ltd. Vs. CCE, Delhi-III - 2013 (31) S.T.R. 684 (Tri.- Del.) it has been categorically held that such services qualify as input services. The expression 'activities relating to business' used in the inclusive part of the definition of input service has been given the wides .....

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ed to credit of ₹ 37,048/- for Management, Maintenance & Repair Service. 7. The Commissioner (Appeals) has disallowed credit of ₹ 91,958/- on Manpower Recruitment Services on the view that these services have no nexus with the provision of output services. That the absence of such services would not affect the provision of output service. The appellants contended that the appellant received services from various service providers, who provide support staff and nurses to the appel .....

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ervices of man-power recruitment and supply agency's service for hiring nurses for its' employees and also for hiring administrative and support staff which is required for carrying out its' day to day business activities. Therefore I find that the denial of refund on Manpower Recruitment Service, is unjustified. The same has to be allowed. 8. The claim of ₹ 37,548/- on Security Agency Services has been rejected for the reason that it has no nexus with output service. The appel .....

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lying the ratio laid in the above judgment I am of the view that appellants are entitled to credit/refund on these services. 9. The learned DR vehemently contended that refund/credit is not admissible for cleaning services. According to him some of the invoices show for cleaning work done of the guest house premises of the appellant. The appellant's counsel submitted that these guest houses are being maintained for use by employees of the appellants who travel from one place to another for b .....

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ground that these are utilized for stay in hotel and have no nexus with output service. The appellants have claimed credit on service tax paid for stay in hotel as renting of hotel/renting of immovable property. That rooms were availed by employees to stay for business activities. The appellants have claimed credit of tax paid by persons for stay in hotels on the guise of the heading 'Renting of Immovable Property'. Therefore the denial of credit/refund on these services, in my opinion .....

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laim of refund which calls for no interference. 12. An amount of ₹ 8240/- claimed towards service tax paid on Business Support Services was denied. According to appellant summits were conducted in which helped them improve their cliental. That such Summits helps the Company to meet potential clients and promote its' business and gain knowledge. I cannot differ with the submissions made by the learned advocate for the appellants as such summits do help the Company to promote and develop .....

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utput service. The rejection of claim on the ground that filing of appeal or reply is not mandatory requirement is baseless. Legal consultancy services are indispensable for any business to satisfy proper compliance of legal its' requirements. Therefore I hold appellants are eligible for refund of credit on these services. 14. Both the authorities below have taken the view that Chartered Accountancy Services do not qualify as input services. On behalf of the appellants it is submitted that t .....

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69,346/-on the ground that the invoices did not contain PAN based service tax registration number of the service provider or the name and address of consignee is not proper or the address mentioned is not registered with the service tax department. Accordingly to the appellants, it is only a procedural irregularity and that substantive benefit should not be denied on procedural lapses. Against this the learned DR vehemently argued that to claim benefit, the conditions granting such benefit has t .....

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(12) STR 223 (Tri.), CCE, Chandigarh Vs. Stelco Strips Ltd. 2010 (255) ELT 397 (P&H). It is not disputed that tax was paid for the services utilized; so also there is no dispute that the services were utilized in the taxable output services. These invoices pertain to C & F Agents Service, Management, and Maintenance and repair service, cleaning Service, Manpower Recruitment Service, Security Service Telecommunications Service and Renting of Immovable Property. Out of these Renting of Imm .....

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