TMI Blog2019 (1) TMI 1043X X X X Extracts X X X X X X X X Extracts X X X X ..... DER The present appeal has been filed from the impugned order dated 18.04.2018 passed by the Commissioner of Central Tax (Appeals), Raigad, by which the ld. Commissioner rejected the appeal filed by the appellant and held that technical testing and analysis services provided by the appellant cannot be termed as export of service and therefore refund claim of unutilized Cenvat credit of ₹ 4,31,384/- under Rule 5 of CCR, utilized in respect of this service for the period from January 2016 to March 2016 is not admissible. 2. The brief facts of the Appeal are that the Appellant is engaged in the activity of research and development on pharmaceutical products, which is falling under Technical Testing and Analysis Service. The result of testing and research actitivities were/are communicated to their Parent Company, M/. Fertin Pharma, Denmark through e-mail. The goods, on which research and development activity was carried out by the appellant, were purchased from Parent Company for valid consideration after payment of appropriate Customs Duty. In other words, there is no temporary transfer by the Parent Company to the appellant but it is a transaction of sale and purchase, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed with consequential relief, if any to the appellant. He further submitted that for the subsequent period also i.e. from January, 2014 to December, 2015 this Tribunal in another decision in Appellants own case involving identical issue vide order no. A/87552-87557/2018 dated 28.09.2018, titled as Fertin Pharma Research Development Pvt. Ltd. vs Commissioner of CGST, Navi Mumbai decided the issue in favour of the Appellant. He also produced the copy of the said order for my perusal. While going through the same, I find that the aforesaid decision also squarely covers the issue involved in the present appeal. The relevant extract of the said order is as under: xxx xxx xxx. 6. Heard both sides and perused the records. Undisputedly, the appellant had purchased the goods from the overseas company, on which they discharged appropriate customs duty on its import into India. Necessary tests are carried out by them on the said goods in India and after analysis the relevant report was submitted to the overseas Denmark company. In the process of providing the said output service, that is, Technical Testing and Analys ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the country. It would appear from the exposition in the judgment that the tax was intended as a levy on activities that would otherwise be performed by the recipient for itself. The new industry of hiving out or outsourcing of what was, conceivably, being done within the enterprise was intended to be subject to the new levy. In the matter of service rendered by respondent, this activity could, but for commercial viability, will be executed by the recipient within its own organization or the territory in which it exists. The satisfaction of the customer occurs upon an outcome which is possessed by the recipient. Hence, even if some of the activities are carried out in India, by no stretch can it be asserted that the fulfilment of the activity is in India. Therefore, the inescapable conclusion is that the location of the actual performance of the service is outside India and, even with the special and specific provision of Rule 4 of Place of Provision of Services Rules, 2012, the performance of service being rendered outside India would render it to be an export. 14. In this context, the legislative intent of incorporating a special and specific provision in Rule 4 may yiel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase in Rule 4(1) of Place of Provision of Services Rules, 2012 that the taxability is to be determined but from the mischief effect intended to be plugged. It is obviously not intended to tax any activity rendered on goods as to alter its form because that would be covered by excise on manufacture or be afforded privileges available to merchandise trade. The provision itself excludes goods imported temporarily for repairs but that does not, ipso facto, exempt goods imported temporarily for repairs from taxability which would, by default, be predicated by the intent in Rule 3. Consequently, a recipient in India would be liable to tax on such temporary imports for repairs while service to a recipient located abroad would not be taxable. This is in consonance with the privilege of exemption afforded to export of services. The special and distinct role of Rule 4 becomes clearer. 16. Not intended to tax the activity of altering goods supplied by the recipient of service or for repairs on goods, Rule 4(1) of Place of Provision of Services Rules, 2012 would appear, by elimination of possibilities, to relate to goods that require some activity to be performed without altering its form ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iate from the aforesaid observation of this Tribunal. Further, the judgements referred by the learned A.R for the revenue, in my opinion, are not relevant to the facts of the present case, inasmuch as in the said judgement the issue raised was levy of service tax on procurement of FDA certificate for the goods to be sold in the respective country. In the result, following the aforesaid precedent, I do not find merit in the impugned order to the extent of holding that the services provided by the appellant are not the export service under Rule 6A of Service Tax Rules,1994. Consequently, the appellants are eligible to cash refund of the accumulated CENVAT Credit under Rule 5 of the CENVAT Credit Rules, 2004, except in relation to credit availed input services denied by the learned Commissioner (Appeals) observing that necessary evidences in relation to Building maintenance charges were not produced to establish the nexus with the output service and secondly the rent-a-cab service since placed under the exclusion clause of the definition of input service after amendment to Rule 2(l) of the Cenvat Credit Rules, 2004 with effect from 01.4.2011. Accordingly, the matters are remanded to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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