TMI Blog2016 (6) TMI 680X X X X Extracts X X X X X X X X Extracts X X X X ..... ogy Software Services (ITSS). They are aggrieved by the denial of refund to the extent of ₹ 16,88,981/- of service tax paid on some input services availed by them. The period involved in the appeal is January 2012 to March 2012. The main grounds on which the credit/refund denied with respect to certain input services availed by the appellant are absence of evidence of usage for business purpose, not clear as to the purpose for which the charges were paid, input services do not impact the quality of export services produced, or input service not having nexus with the output service. However, with respect to input services like Information Technology Service, Management Maintenance and Repair Services, Manpower Recruitment Agency s Services and Renting of Immovable Property Services, refund of part of the input service credit has been disallowed without recording reasons. 2. I find that during the period January 2012 to March 2012, the following relevant portion of the definition of input service vide Rule 2(l) of the CENVAT Credit Rules 2004, as amended w.e.f. 01/04/2011, was applicable to their case:- (l) input service means any service, -- (i) used by the provider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant has also enclosed sample input invoices along with contemporary copies of internal approval for availing such services to demonstrate that the said services were availed only for business purpose. In the circumstances, I hold that the denial of the refund is not justifiable. ii. Banking and Other Financial Services Refund of credit on these services has been disallowed by lower authority on the ground that no connectivity has been established to conclude that the said services are used in relation to export. The appellant has adverted that these services were received by them to provide the employees the foreign currency on overseas tours to meet clients and hence, directly connected with the rendering export of output service. The appellant has also submitted copies of sample input service invoices along with contemporary copies of internal approval for availing such services to demonstrate that the said services were availed only for business purpose. In the circumstances, I hold that the denial of the refund is therefore not justifiable. iii. Chartered Accountant s Services The refund of the credit on these services has been disallowed by lower autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of clarity as to the purpose for which these charges are paid and in which manner these services are related to output service exported. The appellant has adverted that the services provided by Custom House Agents are availed by the appellant in connection with import of IT equipment from outside India. I find merit in the aforesaid submission of the appellant, especially when it has not been disputed by the Revenue that these services have been used for enabling customs clearances of employees and / or their personal goods in activities relating to business purpose. In the circumstances, I hold that the denial of the refund for this input service is not justifiable. vii. Information Technology Software Services. The lower authority while conceding that the assessee is eligible for refund of the credit on this service, has however disallowed an amount of ₹ 4,635/- without assigning any reason thereof. The appellant has adverted that the impugned credit amount has been incurred by them on the invoices raised by M/s. TenXLabs Technologies Pvt. Ltd. towards hosting charges availed by them to access web based application and that the same are directly related to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s included in the inclusive portion of the definition of input service referred supra. I therefore hold that the denial of the refund for this input service is not justifiable. xi. Renting of Immovable Property Services The lower authority, while inter alia holding that the appellants are rightly eligible for claiming refund of the service tax paid on renting of immovable property, has however disallowed an amount of ₹ 1,19,160/- pertaining to rent of fit outs and has also held that input services should have been used for providing the output services and input services though used by the service provider would render themselves ineligible if their consumption is not in relation to or not having nexus with the output service. On appeal, the appellate authority has inter alia upheld that part of the order of the lower authority disallowing the refund of CENVAT credit in respect of input services pertaining to rent of fit outs, holding that the same does not form part of immovable property service. Before this Tribunal, the appellant has contended that the fitouts rent are towards the basic furniture and fixtures provided by the premises owner along with the premis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service. I find merit in the above submissions of the appellant. In the circumstances, I hold that the denial of refund of credit on this service is not justifiable. xiii. Sponsorship Services These services are basically for the purpose of enhancement of visibility of the organization and are advertisement services provided by them. This would therefore very much in the nature of advertisement or sales promotion, which finds place in the inclusive portion of the definition of input service. I therefore hold that the appellants are eligible for the refund of credit on this service. xiv. Club or Association Services I find that services such as this provided by a club are excluded from the ambit of input service by virtue of Rule 2(l)(C) of the CENVAT Credit Rules 2004. However in this instance, it has been clarified by the appellant that these services are with reference to the membership fees paid to the Indian Semiconductor Association which represent the interest and concern of appellant and are not availed for personal use or consumption of the employee. This being the case, I hold that this input service is used for the furtherance of the output service provided ..... X X X X Extracts X X X X X X X X Extracts X X X X
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