The Commissioner of GST & Central Excise Versus BNP Paribas Sundaram Global Securities Operations Pvt. Ltd.
Service Tax
2018 (2) TMI 1416 – MADRAS HIGH COURT – TMI
MADRAS HIGH COURT – HC
Dated:- 18-1-2018
CMA No. 57 of 2018
Service Tax
S. Manikumar And V. Bhavani Subbaroyan, JJ.
For the Appellant : Mrs. Aparna Nandakumar
JUDGMENT
( Order of the Court was delivered by S. Manikumar, J )
Civil Miscellaneous Appeal is filed against the Final Order No.40779 dated 22.05.2017 passed in Appeal No.ST/42307/2016, on the file of the CESTAT, Chennai, on the following substantial questions of law.
“(1) Whether the decision of Customs, Excise & Service Tax Appellate Tribunal, South Zonal Bench, Chennai (CESTAT for short) in allowing refund of Cenvat credit even without registration is correct?
(2) Whether CESTAT is erred in not considering the safeguards, conditions and limitations as stipulated in the Appendix to the Notification No.27/2012-CE(NT) dated 18.06.2016”
2.
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tion
01.
Car Parking charges
1557
Not an input service as per Rule 2(I) of CENVAT credit Rules
02.
Challan for payment under reverse charges not submitted
17072
03.
Service Tax amount not mentioned in invoices
60486
04.
Unregistered premises at Principal Tower, College Road, Chennai
17721
The premises were not registered
05.
Services received at 4th and 5th Floor of Menon Eternity, New Door No.165, St.Mary's Road, Alwarpet, Chennai-18
1668253
The premises were not registered at the time of export but subsequently obtained Registration.
06.
Services received at international Tech Park Unit No.1 to 4, 11th Floor Taramani, Chennai
1357366
3122455
(c) The respondent also filed refund claim with the A
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p; scrubbing machine
1548
04.
Services received at 4th and 5th Floor of Menon Eternity, New Door No.165, St.Mary's Road, Alwarpet, Chennai-18
1596745
The premises were not registered at the time of export but subsequently obtained Registration.
05.
Services received at international Tech Park Unit No.1 to 4, 11th Floor Taramani, Chennai
1241139
2869813
(d) Aggrieved by the above orders, the respondent filed the appeal before Commissioner (Appeals) viz., the first appellate authority. Commissioner (Appeals), vide combined order-in-appeal No.51 & 52 of 2016 dated 26.04.2016 set aside a portion of the order of the original authority and allowed the refund as detailed above.
S.No.
Services
Allowed by Commissioner (Appeals)
OIO No.05/2016
OIO No.12/2016
01
Car Parking charges
1557
0
02
Rental charges for scrubbing
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respondent had not produced any Registration Certificate for these premises. Hence, upheld the disallowance of CENVAT credit to these premises.
(f) In respect of Car parking charges, Commissioner (Appeals) observed that the parking area cannot be considered as a separate area and it is a part of the premises occupied by the respondent. Also held that once, the service tax paid on the rental charges is eligible for CENVAT credit, then service tax paid on the car parking charges is equally eligible for CENVAT credit and set aside the disallowance of CENVAT credit.
(g) In respect of rental charges paid for scrubbing machine, Commissioner (Appeals) observed that the scrubbing machine was used for cleaning the office of the respondent and it has nexus with the provision of their output service and thus the service qualified as input service for taking CENVAT credit as per the definition of the input service and set aside the disallowance of CENVAT cerdit.
(h) While the Commissioner (Appe
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a Wireless Solutions P Ltd., Tavant Technologies I P Ltd., & Atrenta India has upheld the decision of the Tribunal that refund could be granted to the assessee even if the premises in issue were not registered.
(iv) The judgment of the jurisdictional Hon'ble High Court is fully applicable to the facts and issued involved in respect of the impugned appeals.
Accordingly, CESTAT has dismissed the appeals filed by the Department. Being aggrieved, the Department has filed the instant appeal on the substantial questions of law stated supra.
3. On this day, when Civil Miscellaneous Appeal came up for admission, attention of this Court was invited to a decision of this Court, in Commissioner of Service Tax-III Vs. Customs, Excise & Service Tax Appellate Tribunal, Chennai & Another, reported in 2017(3) GST L 45(mad) : 2017 (4) TMI 943.
4. Questions of law considered by a Hon'ble Division Bench of this Court in CMA No.860 of 2017 dated 10.04.2017, are extracted
“1. Whether the dec
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on bearing No.05/2006-CE (NT), dated 14.03.2006, as it forms part of grounds of appeal.
7.1. To our minds, a bare perusal of the said notification would show that it only sets out the procedure for claiming refund of unutilized input service credit. The only clause of the notification, which, perhaps, the Department could have relied upon, is Clause 3, which, to our minds, has no bearing on the issue arising in the instant case. For the sake of convenience, the relevant part of the said notification is extracted hereafter :
“Notification No.05/2006-Central Excise (N.T.)
14th March 2006
G.S.R. (E) In exercise of the powers conferred by rule 5 of the CENVAT Credit Rules, 2004 (hereinafter referred to as the said rules), and in supercession of the notification of the Government of India in the Ministry of Finance (Department of Revenue), No.11/2002 – Central Excise (NT), dated 1st March, 2002, published in the Gazette of India Extraordinary, vide number G.S.R.No.150(E), dated 1st
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act been exported ; or
(b) the registered premises of the service provider from which output services are exported is situated, along with a copy of the invoice and a certificate from the bank certifying realization of export proceeds.”
7.2. A bare perusal of the clause would show that in so far as the provider of output services is concerned, for making an application for refund of CENVAT Credit, he is required to file an application in the prescribed form, i.e., Form A, which is annexed to the notification, and the said application is required to be made to the Deputy Commissioner of Central Excise, or, the Assistant Commissioner of Central Excise, as the case may be. In so far as the jurisdiction of the concerned Officer is concerned, the same is fixed, in consonance with the location of the registered premises of the service provider, from which, the output service are exported. Furthermore, the application is required to be accompanied with a copy of the relevant invoices and
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t will be restricted to the extent of the ratio of export turnover to the total turnover for the given period to which the claim relates, i.e., Maximum refund ? total CENVAT credit taken on input services during the given period X export turnover / Total turnover ………”
7.5. Therefore, there is no merit in the submission advanced on behalf of the Revenue that the said notification would disentitle the claim of the Assessee qua refund of CENVAT credit.”
6. On Questions of Law 1 and 3, the Hon'ble Division Bench, at paragraph Nos.8.4 to 8.7, considered thus
“8.4.What is relevant to note is that Rule 5 of the 2004 Rules does not stipulate registration of premises as a necessary prerequisite for claiming a refund.
8.5.In so far as the Assessee in this case, is concerned, it had obtained registration of its premises way back on 23.01.2009. The record shows that allegation of non-registration of premises relates to another building, which was taken on lease by the Assessee an
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tered.
8.7.As a matter of fact, in this particular case, only the “additional building, which was taken on lease and was located at Alwarpet, Chennai”, was not registered.
7. After considering the decisions in mPortal India Wireless Solutions (P) Ltd. Vs. Commissioner of Service Tax, Bangalore, reported in 2012 (27) S.T.R. 134 (Kar.), Commissioner of Service-Tax Vs. Tavant Technologies India Pvt. Ltd., reported in 2016 (3) TMI 353, Commissioner, Service Tax Commissionerate V. Atrenta India Pvt. Ltd., reported in 2017 (2) ADJ 590 and Commissioner of Central Excise, Coimbatore Versus Sutham Nylocots, reported in 2014 (306) E.L.T. 255 (Mad.), the relevant rules, facts of the case therein that the additional building taken on lease was not registered with the concerned authority and while agreeing with the view taken by Karnataka and Allahabad High Courts, ultimately held that there was no error, in the order of the tribunal, and accordingly answered the substantial questions of law,
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