The Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ), Allahabad Bench directed the revenue to refund the admissible amount of credit to Kronos Solutions India.
The appellant, Kronos Solutions India Pvt. Ltd. was registered with the Service Tax department for providing taxable service under the category of ‘Information Technology Software Services”. The appellant has been availing the facility of cenvat credit in terms of Cenvat Credit Rules, 2004.
As such on services being exported, they were entitled to refund of such accumulated credit. In terms of Rule 5 of said Rules read with Notification No. 27/2012-CE (NT) dated June 18, 2012, the appellant was required to debit the cenvat credit from their Cenvat Credit account at the time of filing of refund application.
The proceedings were initiated against them by way of show cause notice, proposing to deny the refund claim. The said show cause notice culminated into an order passed by the Original adjudicating authority and upheld by the Commissioner (Appeals).
The appellant had taken a categorical stand that the debit was made prior to filing of the refund claim. The Revenue is not disputing the\ debit entry but is adopting a hyper technical view that such debit entry was reflected in the return of the subsequent period and not for the period in question.
The coram consisting of Archana Wadhwa noted that such a refund claim cannot be denied on procedural grounds. There is no dispute about the fact that services in question were exported and appellant is otherwise entitled to the refund of accumulated credit in terms of Rule 5 of the Cenvat Credit Rules read with Notification in question.
“Inasmuch the books of accounts stand already debited by the appellant on 05.03.2014, before filing of refund claim on 20.03.2014, I find no justifiable reason to deny the refund claim on the said hyper-technical ground. Accordingly, the impugned order is set aside and Revenue is directed to refund the admissible amount of credit to the appellant,” the CESTAT said.
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