IN THE CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI
March, 03rd 2014
2013 (1) ECS (137) (Tri-Mum)
IN THE CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT MUMBAI
M/s BNY Mellon International Operation (India) Pvt. Ltd.
Commissioner of Central Excise (Appeals), Pune-III
Appeal No. ST/602, 603, 604/2012-Mum.
[Arising out of Order-in-Appeal No. P/III/RS/176, 177 & 178 / 2012 dated 25/5/2012 passed by
the Commissioner (Appeals) Central Excise, Pune]
M/s BNY Mellon International Operation (India) Pvt. Ltd. Appellant
CCE (Appeals), Pune-III Respondent
Shri Ravikumar Yanamandra C.A. for Appellant
Shri V.R. Kulkarni, Deputy Commissioner (AR) for the respondent
Mr. Sahab Singh, Member (Technical)
Date of Hearing: 2.11.2012
Date of decision:2.11.2012
ORDER NO A/350-352/2012/SMB/C-IV
"I find that the Hon'ble High Court of Karnataka has examined admissibility of
refund under Rule 5 of the Cenvat Credit Rules, 2004 in case of shell India Markets
Pvt. Ltd. vs. CCE, Bangalore 2012 (278) E.L.T 50 (Kar.) and the Hon'ble High
Court in para 7 of its judgment has held as under:-
"It is necessary to verify not only that particular input service is consumed
for providing particular output service but also that eligible service received
under various invoices have actually gone into consumption for providing
impugned exported output service and not utilized for other purpose.""
Per: Sahab Singh
1. These are three appeals filed by M/s BNY Mellon International Operations (India) Pvt.
Ltd. (hereinafter referred to as appellants) against the Order-in-Appeal No..P III/RS/176,
177 & 178/2012 dated 25.5.2012.
2. The brief facts of the case are that appellants are engaged in the case of export of
services, in the nature of Business Auxiliary Services. The appellants exported the
taxable output services under Rule 3 of the Exports of Service Rules 2005 which has
resulted in accumulation of un-utilized credit of service tax availed on input services.
Therefore the appellants filed three separate refund claims of Rs. 37,31,850/-, Rs.
30,72,784/-and Rs. 29,35,697/- for the month of October, November, December 2010
respectively. The adjudicating authority has allowed the admissible amount and rejected
the partial amounts of Rs. 1,01,903/-, Rs 26,318/- and Rs. 4,60,501/- in respect of the
above mentioned period. The appellant filed appeals before the Commissioner (Appeals),
who has rejected the appeals of the assessee and the appellants are in the Tribunal against
the impugned order.
3. The learned Advocate appearing for the appellant submitted that there is no dispute with
regard to eligibility of the input services in respect of which the refund has been denied
by the department. He submitted that adjudicating authority has rejected their refund
claim on the ground that these input services have been received by the appellants after
the period of export of services. he further submitted that the adjudicating authority has
also rejected the refund claim in respect of input services comprising of distribution of
Sodexo Meal Passes as the same are in the nature of welfare measure to the employee of
the appellants. He submitted that since these services are used in output services of final
products the credit of the tax paid on these services is liable to be refunded to them under
Rule 5 of the Cenvat Credit Rules.
4. The learned Deputy Commissioner (A.R) appearing for the Revenue reiterated the
findings of the lower authorities.
5. After hearing both sides I find that since the issued involved in all the three appeals is
identical I take up all the appeals together.
6. I find that the refund has been denied to the appellant on the ground that refund of Cenvat
credit had been claimed in respect of input services received by the appellant after the
period of expotand hence cannot be considered as input services used for the purpose of
exported service during the period in question. This is a fact on record that these input
services were received after the period of export and this fact is not challenged by the
appellants. I find that the Hon'ble High Court of Karnataka has examined admissibility of
refund under Rule 5 of the Cenvat Credit Rules, 2004 in case of shell India Markets Pvt.
Ltd. vs. CCE, Bangalore 2012 (278) E.L.T 50 (Kar.) and the Hon'ble High Court in
para 7 of its judgment has held as under:-
"It is necessary to verify not only that particular input service is consumed for
providing particular output service but also that eligible service received under
various invoices have actually gone into consumption for providing impugned
exported output service and not utilized for other purpose."
In view of the above decision of the Karnataka High Court, I find that their refund has
rightly been rejected by the lower authorities.
7. In respect of two appeals the refund of Cenvat credit in respect of input services
pertaining to Meal Vouchers has been denied on the ground that these activities were
undertaken by the appellant for welfare of the employees and such activities are not the
activities used for providing output service. I find that the Cenvat Credit of service tax
paid on the outdoor canteen service is available to the appellant if the employees have
not borne the service tax amount and the appellant has not charged the employee for
providing the service as held by the Hon'ble Bombay High Court in the case of Ultratech
Cement Ltd. reported in 2010 (260) ELT 369 (Bom.). Since the appellants are entitled for
Cenvat credit of service tax on these services, they will also be eligible for refund of the
same under Rule 5 if the services pertain to the period of refund in question. Therefore,
the appellant will be entitled for refund of the Cenvat Credit pertaining to these services
if the said service was utilized in the period in question and the appellants have not
charged their employees for providing these services.
8. In view of the above, Appeal No. E/603/12 and E/604/12 are partly allowed and partly
rejected and Appeal no. E/602/12 is rejected.
(Pronounced in court)