Decided on April 08,2015

Hcl Comnet Systems And Services Ltd. Appellant
Commr. Of Cus., C. Ex. And S.T., Noida Respondents


G. Raghuram, J. (President) - (1.)THE appeal is preferred against the order dated 26 -8 -2013 passed by the Commissioner (Appeals) Central Excise, Customs and Service Tax, Noida partly allowing the appeal preferred by the assessee; granting refund of credit of service tax in respect of pest control service amounting to Rs. 633/ -; refund of charges relating to professional services concerning income tax assessment of Rs. 10,300/ -, (subject to verification of the relevant documents) but rejecting claim of refund of credit of service tax of Rs. 21,42,757/ -, paid by the appellant on immovable property taken on rent from its holding company M/s. HCL Technologies Limited. An appeal was preferred against the adjudication order dated 30 -4 -2013 which rejected the claim for refund of service tax liability incurred in respect of renting of immovable properties; and two other elements, which were however allowed by the appellate Commissioner. On 12 -12 -2012, appellant filed a refund claim, inter alia for refund of Rs. 21,42,757/ - being the service tax component remitted by the appellant to the holding company from whom it had sub -leased premises. The primary authority rejected this part of the claim on the ground that rent was paid through a debit note, which is not a proper document under the Central Excise Rules, 2002; that the rent pertains to the period July, 2008 to June, 2010 but was paid on 29 -2 -2012 and is hence barred by time; that the appellant failed to prove remittance of service tax to the Government exchequer; that one of the premises Arihant Building is not the registered premises in specified Form ST -2 which also does not contain the name of the building; and that the debit note is issued in the name of "Arihant building" while refund is claimed for service tax on inputs while the export is made much later i.e. during January, 2012 to March, 2012, in respect of rent pertaining to a much earlier period i.e. July, 2008 to June, 2010.
(2.)ON appeal, the ld. appellate Commissioner reversed the conclusion by the primary Authority and held that a debit note could be used for availing credit in terms of Rule 4A of Service Tax Rules, 1994 and would be an admissible document for availing Cenvat credit. The appellate Commissioner however confirmed the finding by the primary authority rejecting the claim for refund of Rs. 21,42,757/ -, on three premises, which are impeached in the appeal before the Tribunal.
Firstly, the appellate Commissioner held (concurring with the primary authority that since the rent pertains to the period July, 2008 to June, 2010 and service tax and the rent was remitted qua a debit note entry (on 29 -2 -2012), the transaction between M/s. HCL Technologies Limited and the appellant cannot be said to be an arm's length transaction since the lessor accepted payment of rent after two to three years. Therefore, the appellate Commissioner reasoned, debit notes are inadmissible and the claim should be supported by the other documents. The appellate Commissioner proceeded to observe that since the appellant failed to furnish a C.A. certificate to support the payments and since this was an "extraordinary case" and much delay had occurred in payment of rent, submission of ST -3 returns of the service provider are not sufficient.

(3.)THE second reason adduced by the appellate Commissioner for rejecting this refund claim is that "Arihant building" is not the address mentioned in the Form ST -2 certificate; that the appellant provided a copy of the lease deed executed on 12 -12 -2011 which does not pertain to the lease period from July, 2008 to June, 2010 for which the rent was remitted by way of a debit note of M/s. HCL Technologies Limited and therefore the appellate Commissioner agrees with the finding of the adjudicating authority that the premises was not the registered premises.

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