Decided on April 29,2015

Dorling Kindersley (I) Pvt. Ltd. Appellant
Commr. Of C. Ex. And S.T., Noida Respondents


S.K.MOHANTY, MEMBER (J) - (1.)THE appellant provides Business Support Services to its clients situated in United Kingdom and also to clients situated within the Country. The appellant avails Cenvat credit of various input services used for providing such output service. Since Service Tax attributable to the provision of domestic services are very meagre, there was no scope for utilising the entire cenvat credit of service tax taken on input services and accordingly, for the disputed period, the appellant had filed the refund application under Rule 5 of the Cenvat Credit Rules, 2004, claiming refund of the unutilised Cenvat credit. The refund application filed by the appellant for the quarter ending September, 2012 was partly denied to the appellant on the ground that the Cenvat credit from the period 1 -7 -2012 to 31st August, 2012 was taken prior to obtaining Service Tax registration by the appellant as a service provider. Further, Cenvat credit of Rs. 129/ - on the domestic courier service has also been denied on the ground that the said service has no nexus with the service exported by the appellant. The ld. CA appearing for the appellant submits that the Cenvat rules dealing with refund of unutilised Cenvat credit, no where specifies that the service provider has to be registered with the Service Tax authority for claiming refund of service tax. According to him, the refund claim under Rule 5 of the CCR, 2004 can only be filed by the service provider, in the eventuality, when the output service have actually been exported and the credit taken on the input services are not utilised due to any reason. With regard to disallowance of Cenvat credit on the domestic courier service, the submissions of ld. Chartered Accountant is that the said service is confirming to the definition of input service and being utilised for providing taxable service to the clients located in both within and outside the country the credit on such service cannot be denied. He further submits that the said service is qualifying as input service for the purpose of taking Cenvat credit and its refund under Rule 5 cannot be denied to the appellant. To support his stand that refund claim cannot be denied on the ground of non -registration of the service provider, he relied on the judgment of Hon'ble Karnataka High Court in the case of mPortal India Wireless Solutions P. Ltd. v. C.S.T., Bangalore, reported in : (2011) 16 353 (Kar.) : 2012 (27) S.T.R. 134 (Kar.) and also decision of this Bench of this Tribunal in the case of M/s. ML Outsourcing Services Pvt. Ltd. v. Commissioner of Service Tax, reported in : 2013 (12) TMI 621 - CESTAT, New Delhi.
(2.)Per contra, the ld. DR appearing for the Revenue submits that Rule 4(1) of the Service Tax Rules and Notification No. 27/2012 -C.E., dated 18 -6 -2012 specifically provides that the service provider has to statutorily required to be registered within 30 days from the commencement of the business activities, which in the present case has not been complied with by the appellant. According to the ld. D.R., since the appellant got itself registered after 60 days on 31st August 2012, Cenvat benefit by way of refund under Rule 5 of the rules is not permissible to the appellant. He further submits that the judgment of Hon'ble Karnataka High Court in the case of mPortal India (supra) is distinguishable from the facts of the present case, inasmuch as, the said judgment was delivered in the year 2011, whereas, the Notification No. 27/2012 -C.E. (N.T.), dated 18 -6 -2012 was issued only in 2012, which is much later than the passing of judgment by the Hon'ble High Court. According to the ld. DR, since the appellant had subsequently registered with the Department on 31st August, 2012 (certificate issued on 14 -9 -2012), the application for refund filed for the period 1 -7 -2012 to 31 -8 -2012 will not be admissible.
(3.)HEARD the ld. Counsels for the parties and perused the records.

Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.