The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chandigarh has held that the place of receipt outside India qualifies as export service and the denial of service credit is not sustainable.
The appellant, M/s. BlackRock Services India Private Limited challenged the orders dated 31/08/2018 and 31/10/2018 respectively passed by commissioner CGST (Appeals), Gurugram by which the Commissioner rejected the appellant‟s appeal and upheld the order of Adjudicating Authority of rejecting the refund of Cenvat Credit on Input Service used in the provision of Business Support Service(“BSS”) exported outside India.
The appellant undertakes its business activities through its SEZ unit in Gurugram, Haryana and STPI unit in Mumbai, Maharashtra which were a hundred per cent export units. The refund claims of Rs.28,30,015/- for the period April 2016 to June 2016 and of Rs.93,61,891/- for the period July 2016 to March 2017 were filed by the appellant under Rule 5 of Cenvat Credit Rules, 2004 read with notification No. 27/2012 CE(NT) dated 18/06/2012 for a refund of un-utilised Cenvat credit availed on input service used in providing taxable services “business support services”.
The refund claims were rejected by the Adjudicating Authority on the ground that the service provided by the appellant are “intermediary service” and therefore in terms of Rule 9(c) of Place of Provisions of Services Rules, 2012 the place of provision of service was in India.
It was observed that there was nothing to show that the appellant was liasioning or acting as an intermediary between the HLX and its clients. Further observed that Rule 3 of Place of Provision of Services Rules, 2012 provides that generally, the place of provision of service was the location of the service recipient.
Mr P V Subba Rao, member (technical) and Mr Ajay Sharma, member (judicial) observed the location of service receiver M/s. HLX was located outside India i.e. USA, therefore, the place of provision of service was outside India and the service in issue qualifies as export of services in terms of Rule 6A of Service Tax Rules, 1994.
The Tribunal held that “the orders of lower authorities denying Cenvat credit on impugned services are not sustainable in law and therefore the appeals filed by the appellant deserve to be allowed. The said authority is directed to dispose of the refund claim within a period of three months from the date of receipt of this order, after giving a proper opportunity to the appellants.”
Shri Kamal Sahwney, Krishna Rao &Anishka Gupta appeared for the appellant and Shri Amandeep Kumar appeared for the Respondent.
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