TMI Blog2023 (9) TMI 455X X X X Extracts X X X X X X X X Extracts X X X X ..... RT] that CENVAT Credit is available though the export of service is not a taxable service. Further, the findings of the Commissioner (Appeals) that Appellant s case fits into the ratio of LALLY AUTOMOBILES PVT. LTD. VERSUS COMMISSIONER (ADJUDICATION) , CENTRAL EXCISE [ 2018 (7) TMI 1679 - DELHI HIGH COURT] is untenable since it was passed in respect of trading which is not at all a service as per Article 366(29A) of the Constitution of India and, therefore, considered as exempted from Service Tax purview. The other ground of rejection of refunds relates to the description contained in the invoices which are admittedly in short forms which is not at all tenable for the reason that neither any query was made during personal hearing to find out the full forms of those descriptions given in the invoices nor the kind of services rendered in the service agreement was tallied with to ascertain the truth - Be that as it may, it is a settled position of law after pronouncement of the mPortal India Wireless Solution Private Limited judgment that export of software services even if not considered as taxable services, the exporter shall be entitled to get refund of CENVAT Credit which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... qualify the supplies as export of services, non-utilisation of those credits towards payment of Service Tax necessitated filing of refund application for refund of accumulated credits in every quarter, noted above, under Rule 5 of the CENVAT Credit Rules, 2004 read with Notification No. 05/2006 C.E. (NT) dated 14.03.2006 and it had suffered through the entire process noted above. 3. During the course of hearing of the appeals, learned Counsel for the Appellant Mr. Prakash Shah submitted that in the second round of litigation, learned Commissioner (Appeals) vide his common Order-in-Appeal dated 26.09.2019 had rejected the appeal primarily on the grounds that: (i) Rule 6(1) of CENVAT Credit Rules specifically bars availment of CENVAT Credit of inputs/input services used in manufacture of exempt goods/ providing of exempt services; (ii) Question of refund under Rule 5 of the CENVAT Credit Rules would arise only when output services are taxable and referring to the Hon'ble Delhi High Court judgement passed in Lally Automobiles Pvt. Ltd. Vs. Commissioner reported in 2018 (17) GSTL 422 (Del.), he noted that Appellant had not rendered any specific discernible services, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udgment and the same is unrelated to the case of the Appellant. In citing precedent case laws on the issue of admissibility of CENVAT Credit on export of services in the case of mPortal India Wireless Solution Private Limited reported in 2012 (27) STR 134 (Kar.) that has been followed consistently by this Tribunal in the case of KPIT Cummins Infosystems Ltd. Vs. Commissioner of Central Excise, Pune-I reported in 2013 (32) STR 356 (Tri.-Mumbai), AXA Business Services Pvt. Ltd. Vs. Commissioner of Service Tax, Bangalore reported in 2017 (49) STR 556 (Tri.-Bang.), Capgemini Technology Services India Limited Vs. CCE CST, Bangalore Service Tax I, reported in 2022 (2) TMI 559 CESTAT, Bangalore, Zenta Private Limited reported in 2012 (284) ELT 45 (Tri.), he argued that it has been categorically held in those judgements that even the export of services including export of software services are not taxable services still refund of CENVAT Credit cannot be denied to the assesse and in no circumstances such refund can be denied by the Adjudicating Authority in going into re-classification of services without serving a show-cause notice and initiating a separate proceeding against the Appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tted that inputs and input services used for providing output services that were being exported were subjected to the conditions/restrictions of Export of Service Rules, 2005 or Central Excise Rules, 2002 as set out in the appendix and under Clause 3 of Export of Service Rules, 2005, taxable services are enumerated and the Appellant s alleged services are not covered therein for which interference in the order passed by the Commissioner (Appeals) is uncalled for. 5. We have gone through the case record and taken note of the submissions made before us. The said two services namely ITSS and BSS which are reflected in the ST-3 returns including sample returns annexed at page 109 and 112 of the appeal memo are taxable services and only because of the benefits of Notification No. 09/2005-ST was availed by the Appellant that provided exemption for export of services, Service Tax was not payable. However, it was held by Hon'ble Karnataka High Court in the case of mPortal India Wireless Solution Private Limited reported in 2012 (2) STR 134 (Kar.) that CENVAT Credit is available though the export of service is not a taxable service. Further, the findings of the Commissioner (Appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rocedure laid down in the Central Excise Rules, 2002 or in the Export of Service Rules, 2005 and not solely on Export of Service Rules, 2005. Even so, under sub-Rule 3 of Export of Service Rules, 2005 taxable services are defined and the services rendered by the Appellant are not included therein but sub-Rule 4 has made it clear that any service which is taxable under Clause 105 of Section 65 of the Act, may be exported without payment of Service Tax. In other words, the services rendered by the Appellant are defined as taxable services under 65(105) of the Finance Act, 1994 but for the purpose of export only they were allowed to export the same without payment of Service Tax but that by itself would not put the services under the category of unentitled service, so as to deny CENVAT Credit and consequential refund to the Appellant. Hence the order. THE ORDER 6. Both the appeals are allowed and the order passed by the Commissioner of GST and CX (Appeals-I), Mumbai vide Order-in- Appeal No. NA/GST CX/A-I/MUM/186-187/19-20 dated 26.09.2019 is hereby set aside. Appellants are entitled to get refund of Rs.6,84,91,885/- + Rs.13,00,32,070/- with applicable interest and the Res ..... X X X X Extracts X X X X X X X X Extracts X X X X
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