Cst Bangalore vs M/S. New Enterprise Associates (I) Pvt ...

[Arising out of Order-in-Appeal No. 357/2011 dated 21/07/2011 passed by the Commissioner of Central Excise (Appeals-II), Bangalore.]

For approval and signature:

HON'BLE SMT. ARCHANA WADHWA, JUDICIAL MEMBER HON'BLE SHRI ASHOK KUMAR ARYA, TECHNICAL MEMBER

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3 Whether Their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes

CST BANGALORE NO. 16/1, S.P. COMPLEX, LALBAGH ROAD, Bangalore. Appellant(s)

M/s. NEW ENTERPRISE ASSOCIATES (INDIA) PVT LTD 7/4, GROUND FLOOR, THAPAR NIKETAN, BRUNTON ROAD, BANGALORE 560 001 Appellant(s)

Versus

M/s. NEW ENTERPRISE ASSOCIATES (I) PVT LTD

Respondent(s)

Commissioner of Service Tax BANGALORE-SERVICE TAX 1ST TO 5TH FLOOR, TTMC BUILDING, above BMTC BUS STAND,DOMLUR BANGALORE  560 071.

KARNATAKA Respondent(s)

Appearance:

Mr. B. G. Chidananda Urs, No.520, Amruth Nivas, 7th Main, 13th Cross, RMV II Stage, Dollars Colony, Bangalore - 56 094. For the Appellant

Mr. N. Jagadish, Superintendent (AR) For the Respondent

Date of Hearing: 15/07/2015

Date of Decision: 15/07/2015

CORAM:

HON'BLE SMT. ARCHANA WADHWA, JUDICIAL MEMBER HON'BLE SHRI ASHOK KUMAR ARYA, TECHNICAL MEMBER

Final Order No. 21587-21588 / 2015

Per : ARCHANA WADHWA

Both the appeals one filed by the appellant and the other filed by Revenue are being disposed of by a common order as they arise out of the same impugned order passed by the Commissioner (A).

2. After hearing both the sides, we find that the appellant claimed refund of input service credit utilized for their output service of Management Consultancy Service to M/s. NEA Development Corporation, Delaware, USA. The said refund claim of Rs.21.70 lakhs approximately was rejected by the original adjudicating authority on the ground that their output services cannot be considered to be export of services. However, on appeal against the said order, the Commissioner (A) accepted the assessees stand that the services rendered to a foreign company to find out prospective enterprises in India seeking overseas investments are required to be considered as export of service, in the light of the majority decision of the Tribunal in the case of Microsoft (I) (P) Ltd. vs. CST: 2014 (36) S.T.R. 766 (Tri.-Del.). He accordingly allowed the refund claim on Management or Business Consultancy services; Rent-a-Cab services, Telephone services by treating the same as cenvatable input services. However in respect of refund of credit of duty-paid on Air Travel Agents service, Business Support service, Chartered Accountant service, Manpower Recruitment service, he observed that they are not something which are unavoidably required to run its business and rejected the claim.

3. Revenue is in appeal against that part of the impugned order of Commissioner (A) by which he has accepted the appellants stand to hold the output services as export of services. We find that the said issue is no more res integra and stands settled by the majority decision of the Tribunal in the case of Microsoft Corporation (I) P. Ltd., as referred supra. Reference can be made to another majority decision of the Tribunal in the case of Paul Merchants Ltd. vs. CCE, Chandigarh reported as 2013 (29) S.T.R. 257 (Tri.-Del.) as also in the case of Gap International Sourcing (India) Pvt. Ltd. vs. Commissioner: 2014-TIOL-465-CESTAT-DEL. As such we find no merits in the Revenues contention and accordingly reject their appeal.

4. As regards the assessees appeal, we find that disputed services are Air Travel Agents service, Business Support service, Chartered Accountant service, Manpower Recruitment service. The Honble Bombay High Court in the case of Coca Cola India Pvt. Ltd. vs. CCE, Pune: 2009 (15) S.T.R. 657 (Bom.) as also in the case of CCE vs. Ultratech Cement reported as 2010 (260) E.L.T. 369 (Bom.) has held that the definition of input services is very wide and would take into its ambit the services used directly or indirectly for rendering of output services. There are various decisions which hold that Air Travel Agents services procured in connection with the business trips of the employees of the company have to be treated as essential input services. Reference can be made to the Tribunals decision in the case of Heartland Bangalore Transcription Ser. P. Ltd. vs. CST, Bangalore: 2011 (21) STR 430 (Tri.-Bang.). Similarly in respect of Chartered Accountant services, the same decision of the Tribunal holds the said services to be cenvatable services. Similarly Manpower Recruitment services have been held to be cenvatable. As such, we find no justifiable reason to deny the refund of the credit of service tax paid on the said disputed service. Accordingly, the assessees appeal is allowed. Both the appeals are disposed of in above manner.

(Order pronounced in open court)

ASHOK KUMAR ARYA TECHNICAL MEMBER ARCHANA WADHWA JUDICIAL MEMBER

rv 4 1