Tavant Technologies India Pvt Ltd vs Commissioner Of Service Tax ...

[Arising out of Order-in-Appeal No. 232-2011 dated 29/03/2011 passed by CCE(Appeals-II), Bangalore]

For approval and signature:

HON'BLE SHRI B.S.V.MURTHY, 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?

2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

TAVANT TECHNOLOGIES INDIA PVT LTD NO.12, CSRIE -II, GUAVA GARDEN, KORAMANGALA , BANGALORE 560 095 Appellant(s)

Versus

Commissioner of Service Tax BANGALORE-SERVICE TAX NULL 1ST TO 5TH FLOOR, TTMC BUILDING,above BMTC BUS STAND,DOMLUR BANGALORE, - 560071 KARNATAKA Respondent(s)

Appearance:

Shri Akbar Basha, Advocate HIRAGANGE & ASSOCIATES #1010, 1st floor(Above Corp.Bank) 26th Main, 4th T Block, Jayanagar, BANGALORE - 560041 KARNATAKA For the Appellant

Shri R. Gurunathan, Addl. Commissioner(AR) For the Respondent

Date of Hearing: 19/03/2015

Date of Decision: 19/03/2015

CORAM:

HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER

Final Order No. 20797 / 2015

Per : B.S.V. MURTHY

The refund claim filed by the appellant under the Notification No.5/2006-CE(NT) read with Rule 5 of CENVAT Credit Rules 2004 has been rejected on two grounds. The first ground is that the credit was taken when the appellant did not have a registration. The second ground is that in respect of several services, there is no nexus between the input services and the output service.

2. The learned counsel submits that as regards the first issue, it is covered by the decision of the Honble High Court of Karnataka in the case of mPortal India Wireless Solutions Pvt. Ltd. Vs. CST, Bangalore [2012(27) STR 134 (Kar.)]. I find myself in agreement with this and therefore on this ground, claim could not have been rejected. As regards nexus, he has submitted a statement showing each service, name of the output service and justification. On going through the statement which is reproduced below and under each category of service, I consider that the appellant has made out a case as regards nexus.

Name of input service Name of export of Service Justification for availability of CENVAT credit Management Consultancy services

ITSS These services are availed to seeking opinions, technical clarification and understanding of legal provisions etc. It also includes audits, financial consulting services, filing of returns etc. This is essential to export software services. Manpower recruitment agency services/ Advertisement services ITSS The appellant procures services of recruitment agency to hire employees to fill up the different open positions in the organization. It is hereby essential in view of the attrition rate that is common to the industry and also to identify the apt candidate for the job. Since the employees are directly related to the services being exported, it is submitted that these services are essential for smooth functioning of export of service. Rent-a-cab services ITSS The company hires vehicles/cabs to pick up its employees from their residence and drop them back. This essential as the employees have to perform the work at different hours on a shift duty basis. Moreover, the employees are located in different parts of the city and since they are supposed to work in different parts of the city and since they are supposed to work in different time horizons, the productive hours will be lost if they are using the public transport facility.

So, this service is directly linked to the performance of employees which are necessarily required for provision of export of output services. Outdoor catering services ITSS These services are used for providing food for employees, during office hours, as the appellant works round the clock; the appellant has provided facility for outdoor catering. Security agency services ITSS The appellant has availed security services, which is essential in safeguarding the assets of the company. Further the appellant while providing pick-up and drop facility to its employees needs to communicate the cab details for pick up and drop for employees. Therefore the said services are essential for export of services. Business Support Services ITSS These services are availed in order to avail the services of payroll processing, accounting, document storage etc All these services are essential in order to export ITSS. Information Technology Software Services/ Commercial training and coaching services ITSS These services are availed to learn the new technology/ programming etc, which is essential to export software services.

Renting of immovable property services ITSS These services are availed to use the premises from where the services are exported, therefore essential for export of services. Management, maintenance or repair services ITSS These services are availed in order to maintain office equipments like air condition, computers, UPS etc, which are essential to export the services. Pandal and shamiana services ITSS These services are hired to obtain on rent furniture like chairs, table etc, during the recruitment process. Telecommunication/ internet services ITSS These services are essential to export the software vide internet. Appellant uses the facility of conference calls with its clients, telephone call to its customers aboard to resolve client queries. Etc, which is essential for export of services. House keeping ITSS These services are rendered to keep the premises clean and hygienic conditions, which is essential for export of service.

3. In view of the above, appellant has made out a case for eligibility for refund claim. Accordingly, the appeal is allowed with consequential relief, if any, to the appellant. (Order pronounced and dictated in open court)

B.S.V.MURTHY TECHNICAL MEMBER

Raja..

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